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The CHAIRMAX. Would you not like to see the rate of transportation between Scranton and New York reduced so that you could sell cheaper in New York !
Mr. CAMPBELL. I do not know that I wonld.
The CHAIRMAN. Would it not be a great advantage if Scranton could be moved down to within ten miles of New York so that coal could be transported to New York at 25 cents a ton!
Mr. CAMPBELL. I do not see what benefit it would be. The probability is that we can get as much for onr coal now. Of course the nearer the coal region is to the market the less the cost of transportation.
The CHAIRMAN. In other words, would not any reduction in the cost of coal be a benefit to you?
Mr. CAMPBELL. I do not see how. The probability is, according to the natural laws of trade, that if we were nearer to New York, the price of coal would be less.
The CHAIRMAX. Certainly, and you could furnish all the coal that the market would take, whereas now you are not able to furnish more than the fourth of it.
Mr. CAMPBELL. And the railroads would suffer in proportion, because they would be deprived of cargoes.
The CHAIRMAX. If, by any process, the price of coal can be reduced, would it not be an advantage
Mr. CAMPBELL. It would be an advantage if we could maintain the price there.
The CHAIRMAN. So with regard to the foreign markets. The cost of transporting our products to a foreign market is a tax upon the net results that are left to the producer. For instance, we send cotton, corn, and products of all kinds abroad. Out of what we receive for them in Liverpool is deducted the cost of transportation, and the balance is left to the producer. Now, if you add to the cost of transportation, the producer will get so much less. Therefore, the transportation being done in foreign ships the cheaper it is done the more benefit it is to the American producer, is it not?
Mr. CAMPBELL. It is probably a benefit to the American producer, but it is an injury to the people at large. I hold that it is the first duty of a government to protect its own people; that a man who does not provide for his own family is worse than an infidel, and, therefore, I am in favor of high protection.
The CHAIRMAN. It seems to me that if we have to pay a higher rate of transportation on what we sell abroad and on what we bring home, we lose in both directions, and that whoever will do the transportation cheapest for us is our benefactor. The reason why foreigners have got the transportation is because they work cheaper than Americans are willing to work for.
Mr. CAMPBELL. It is generally true that competition lessens the price of transportation. That is evidenced by our railroad system to-day. The more railroads we have and the greater the competition, the loss is the cost of the transportation. I think that if we had shipping of our own, the cost of transportation would be materially diminished, because it is competition that always lessens the price of transportation.
The CHAIRMAN. But the whole world is in compotition now for the carrying trade, and as the trade is open to the whole world, we have competition on all the routes.
Mr. CAMPBELL. It is an admitted fact that to a very great extent the very timber that goes to make up the vessels which carry our trade is shipped from this country to Europe.
The CHAIRMAN, Ships are not built of timber any more; they are built of imn.
Mr. CAMPBELL. Yes, but it is necessary to put a great deal of timber in them. The masts that go on the vessels are of timber.
The CHAIRMAN, O, no; they are all of iron.
The CHAIRMAN. Yes. I have been over the Atlantic eight times within four years, and every ship that I have been on had iron masts. There is nothing now about a ship, even including its rigging, that is not made of iron or steel.
Mr. CAMPBELL. There are a great many wooden ships still on the sea. The great majority of ships plying the ocean to-day are wooden vessels.
The CHAIRMAN. If you examine the figures you will be surprised to find that the bulk of the tonnage of the world is being done on iron ships. The central line has been passed; they build no more wooden ships; all that they build now are iron, because they are operated more cheaply, and the difference in cost is less than is supposed.
Mr. CAMPBELL. Is it not an admitted fact that we only sell about 4 per cent. of coton fabrics outside of our country!
The CHAIRMAX. Yes.
Mr. CAMPBELL. And yet it is also an admitted fact that onr cotton fabrics are better than those of any other country.
The CHAIRMAN. There is a good deal of delusion about that. In certain coarse cotton fabrics our goods are better, but in fine fabrics they are not. We are still importing fine fabrics from abroad ourselves. We are not even producing our own fine fatrics. We imported nearly twenty millions' worth last year,
Mr. CAMPBELL. Still, we have the capacity here for producing cotton goods at a very low figure for importation. Take Mexico, for instance, England has the exclusive trade of Mexico in cotton fabrics.
The CHAIRMAN. Because England sells them cheaper.
Mr. CAMPBELL. How can England sell them cheaper, when we can sell our cotton fabries even in Manchester?
The CHAIRMAN. A few cases of cotton goods have been sent from here to Manchester and have been sold there, as an experiment; but they were sold with a loss. We are not exporting cotton fabrics to England as a matter of trade. We are exporting some to China and to Japan and to South America. Our exports of cotton goods amount to some ten or eleven millions of dollars; but they are of coarse fabrics. When it comes to fine goods, we are undersold by foreigners.
Mr. CAMPBELL. I suppose that it is an admitted fact that not over one-third of the raw material of cotton is manufactured in this country.
The CHAIRMAX. Not quite one-third.
Mr. CAMPBELL. Would it not be better, having the labor and the facilities for manufacturing cotton, if we would manufacture it in this country and seek a market abroad for the manufactured article ?
The CHAIRMAX. Granted; but suppose you could not sell it as cheap as the English sell it, what then ? and we cannot. The New England mills are trying to do the very thing you desire, but they are met in the great markets of the world by the cotton goods manufactured in England. How would you do it? Would you give a bonus to the American manufacturers ?
Mr. CAMPBELL. No, sir; but if we were to manufacture our own raw material the foreigners would not get it from us.
The CHAIRMAN. The answer to that is that the English pay to the men who raise cotton in the South more than New England men would pay for it, and the English will undersell us in the foreign markets. How? Because they have got a cheaper captal and cheaper labor. If the state of things now existing goes on much longer we will have cheap labor too, but that is precisely what these gentlemen (indicating the representatives of the workingmen] do not desire.
Mr. CAMPBELL. Is it not the same in the woolen trade? Is it not true that threefourths of our entire fleece of wool is manufactured abroad, and that three-fourths of the woolen goods used in this country are imported here !
The CHAIRMAX. Admitting the statement to be true, the answer would be, what is the difference? The rates of wages are higher here than they are there, so that we cannot compete with the foreign manufacturers. The remedy is to cut the wages down, but gentlemen have been telling us here that the way to prosperity is to get the wages of the workmen up. I leave you to reconcile the difference.
Mr. CAMPBELL. I thivk that the difficulty about the whole question is in our not keeping the volume of currency at a certain figure. If you regulate the volume of currency and keep it there until there is a demand for an increase we would not suffer under these changes as we do now.
The CHAIRMAN. What better system can you have than the freedom to issue any amount of currency that the people want, provided it is made redeemable in gold and silver?
Mr. CAMPBELL. But one year your volume of circulation is all up and another year it is all down.
The CHAIRMAX. That is because the community does not want so much circulation one year and does want it the next year. For instance, under a free banking system the banks can issue any amount of circulation. The only trouble is that they have to redeem it. You would not have them issue it without redemption.
Mr. CAMPBELL. Is not the principal trouble this, that the government is issuing bonds to absorb the money that is in circulation?
The CHAIRMAX. But the government is not absorbing the money that is in circulation, because it is selling the bonds for gold.
Mr. CAMPBELL. The government takes for the bonds greenbacks at their value in gold.
The CHAIRMAN. Excuse me; the Treasury Department is only authorized to receive gold for the bonds.
The committee desires to say that if there is anybody present who has any suggestions to make the committee will hold another session this evening; otherwise, the committee will close its session in Scranton now. But I think we have succeeded in getting at a fair statement of the condition of things here, and we are greatly obliged to those who have come here to give it to us.
Mr. THOMAS (a former witness). I heard you speak this morning about trades unions for the purpose of arriving at some understanding between employers and employés. Is there any possible way of having a law to protect the members of trades unions
The CHAIRMAN. The General Government cannot do anything in that way; but the States can.
Mr. Thomas. The reason why I ask you is this: We have several times had trades unions in this valley, and these trades unions have had committees for conducting negotiations between them and the employers, and every member of these committees, with probably an exception or two in different localities, has been discharged.
The CHAIRMAN. You have only repeated here the experience which occurred in Great Britain, and which lasted for nearly 40 years there. The employers would not listen to the representatives of the trades unions, and the greatest injuries and wrongs were committed. The men who belonged to these trades unions underwent an amount of suffering which was simply heroic, and at last, in 1867, the famous trades union commission was appointed by the Queen. The chairman, Sir William Earl, one of the greatest jurists that England ever had (he was chief justice of the court of common pleas), reported in favor of legalizing trades unions, and bringing them under the law which governs the friendly societies in England, and they now make reports to a register, Mr. Tidpratt. The result is that the masters not merely recognize the necessity for trades unions, but they recognize the immense advantage which there is in baving trades unions, by which they can arrange all questions in dispute. Take the society of Amalgamated Engineers in England. That society has had but one strike in about ten years--the famous New Castle strike. That was a strike for nine hours' time, and since then they have had no strikes, but every dispute between the engineers and their employers has been settled by agreement between committees of the masters and committees of the men, or by arbitration. This little book here (indicating) contains a history of the arbitrations in every branch of business in Great Britain for the last few years. There are many pages devoted to the coal trade. There are more than twenty arbitrations recorded here. It is the same in the iron trade, in the lace trade, in the carpet trade, and other trades. All these trades have trades unions, regularly organized and legalized. These unions all appoint committees, and the masters also appoint committees, which meet upon equal terms, just as this committee has met you gentlemen and as you have met this committee. The result in England is that strikes have been diminished in number. They are suffering there as they are here, but perhaps less than they are suffering here. The distress is increasing there, particularly in the cotton trade, and if we undertake to meet them in the foreign market, we will be met by people striving in desperation to get something to keep them employed ; so that it is a very bad time for us to try to compete with them. It is a State matter, however, and not a Federal matter, and I think that it is the first duty of every State in the Union to give every possible facility to trade organizations, and that it is equally the duty of the workingmen to organize trades unions; to put the best men in charge of them; and to avoid, if possible, demagogues, and especially petty demagogues, who live upon tribute money. The workingmen should get their most intelligent men, and put them at the head of these organizations; and it will be an everlasting diagrace to the employers if they refuse to meet the committees of these organizations on fair and equal terms. If they do refuse, public opinion will not sanction it. I do not beliere that there is a company strong enough to discharge an honest man of good character because he has organized a trades union, unless he has been playing the demagogue.
Mr. THOMAS. Bosses in this region have been known to stand around the doors of lodge-rooms where men have gone into trades-unions, and when these men came to work, the bosess would quietly
walk up to them and ask them how things went on on such a night. The bosses would ask them whether they belonged to such a tradesunion, and if they admitted that they did, the bosses would come along some day and find something wrong, and the men would be discharged.
The Chairman. You are only repeating what happened year after year in Great Britain, and which has come to an end there through the force of public opinion. The legislature cannot make a law to prevent one man from discharging another. That matter has got to be reached by public opinion. We bad a case the other day at our iron-works. Before we blew out the furnace we called our men together and gave them the figures. We showed them what the iron was costing and what its price was, and we said to them, “There, we cannot get the cost for the iron. Appoint a committee and see these things for yourselves; and if you want us to continue the business, make up a rate of wages that you will be willing to take.” The men got together and made up a rate of wages which was entirely satisfactory to us. There was perfect openness and fairness on both sides. I say that these great corporations here owe it to themselves, owe it to the country, and owe it to you to make a clean, open, honest statement of affairs. The public have got a right to know what these corporations earn, and you ought to know it. If they do not do that, they ought not to have the sympathy of the community. But if they deal honestly and fairly with you, you must not try to get them to pay you what they cannot afford to pay you. You must not try to get up strikes. The truth is that a great many of the railroad com panies in this country are not able to pay interest even on their bonds, and but a few of them are paying dividends on their stock. The Reading Railroad has had to fund the coupons on its consolidated mortgage because they could not earn the interest. If that company had never bought coal lands it would have been paying its iuterest to-day, but these railroad and coal companies made a mistake in purchasing coal lands, and have thus damaged the public as well as themselves. Generally, when people damage the public they damage themselves. The Delaware and Hudson Canal Company loaded itself down with coal lands and railroads so that it is no longer able to pay dividends on the stock; and, from being the most prosperous corporation in the United States, it is now laboring under very serious difficulties. If you examine the case to-day and compare the prices of coal with the cost of production, you will find that after providing for the cost of transporting the coal to market none of those companies are in a condition to pay any more wages than they are paying. I do not think it possible for them to do so. I think they would be delighted if they could give full employment at better wages. The truth is that employers (I am an employer myself) are always glad to pay good wages and to have plenty of work for men, and I assure you that it is excessively disagaeeable for them when they have to cut down wages. I have never known an employer to reduce wages until he was losing so much money that he was driven to it. These coal companies were on the verge of bankruptcy when they reduced the wages of the workingmen. I do not commend the system of uniting the carrying business with the business of mining coal or with any other business. I think that the thing is wrong and should be prohibited. All the sufferings of these coal companies and the depression in the coal business have been, in my opinion, the result of that mistake; because, were it not for it, the extension of coal operations would not have been made any faster than consumers and producers were ready to come together in the market. There is only one way in which the thing will be ever got right, and that is by each side telling the honest and exact truth to the other side, and not trying to deceive the other side. We are only passing through a transition period here. I am afraid that, for another year or so, we will have hard times, but I think I may take the risk of prophesying that, after another year, we are going to have better times, and that you are going to find employment here for all the people who will need employment. But the old rates of wages you will never see again in this country. They were largely fictitious. Instead of getting $3 or $4 a day you will probably get about $1.50 a day, but the wages that you will get will be in gold. The real grievance of the working men generally is not that they are not getting high enough wages, but that they are not getting work enough, but I hope that, in a very little while, prosperity will be restored and that there will be no lack of employment. I did not intend to make any remarks to you, but I was pushed on to do it; and I am sure that if these gentlemen who are interested in the trades union matter will take this little pamphlet and digest it [handing around a few printed pamphlets on the subject], it will do them good.
Mr. CAMPBELL. I would like to inquire whether the depression in the railroad companies is not due to their watering their stocks.
The CHAIRMAN. It might be, if they were paying dividends on their stock.
The CHAIRMAN. Yes; but what they are doing now is the question. I do not believe that the fact of their watering their stock is of any consequence now, because they are not paying dividends on their stock. What difference is it, when they do not pay anything at all on their stock, whether they call it thousands or millions? They have got to have money to pay the interest on their bonds. If they issued bonds for which they had not received any value, then there would be a good ground for complaint; but the watering of their stock does not really make any difference. It does not make a man richer or poorer whether he marks his stock up or marks it down. It made a difference to the people who bought the watered stock.
Mr. CAMPBELL. The railroad companies have a larger capital to pay dividends upon. The CHAIRMAN. But they do not pay any dividends at all; so that that does not affect this question at all.
Mr. Rice. They are not paying running expenses.
Mr. CAMPBELL. I have no doubt but that the Delaware, Lackawanna and Western Company is paying running expenses now.
A SPECTATOR. It earned $500,000 last year.
The CHAIRMAN. You gentlemen of Scranton have got no grievance to complain about in regard to the building of a line of railroad by the Delaware and Hudson Canal Company to Canada. The company built that line and thus got access to iron beds, the ore from which is brought here to run the steel works. You are the gainers by that operation, but the stockholders are the losers. Mr. CAMPBELL. The watering of the stock did not do that.
The CHAIRMAN. The watering of the stock has no earthly influence upon things here. The company sold the stock and put the proceeds in its business. The men who bought the stock were injured by it; and if you are a stockholder you have a grievance, and I would recommend you to go to the next meeting of stockholders and make a great rów.
Mr. CAMPBELL. It injured hundreds of men here. It injured the whole community. The CHAIRMAN. Well, let those men go to the next stock meeting and make a row about it. But when a carrying company is authorized to buy coal property, or any other kind of property, to run iron-works and to engage in business, and if it then will not allow other people an outlet for their products on proper terms, it becomes a monopoly of the most odious kind. It is wrong in principle and fatal in its results, and has got to be undone. The community will never prosper until that has been repealed. I am a large property holder in Pennsylvania, and I am suffering by that policy. I want the law repealed, for it is a very great wrong.
Mr. CAMPBELL. All these corporations onght to be limited to carrying alone. The CHAIRMAN. Certainly. Mr. CHUSHOLM. You are an employer of labor, and I wish to say that if all the employers of labor were to express themselves as you do and to act in conformity with the views which you have expressed, it would be well for the working classes.
The CHAIRMAN. No man has suffered any more from misrepresentation than I have, and on this very labor committee, simply because I have asked questions on all sides of the subject. . I have been misrepresented all over the country, but my hope is that out of this investigation and out of the frank declarations of opinion to which I think honest men who studied the question would be driven, we shall arrive at a solution of the difficulty. The corporations are not your difficulty. They are your friends, but they must be properly condueted and managed. It is the abuses of these corporations that we want to correct. We do not want to destroy the corporations themselves.
Mr. CHISHOLM. I desire to say one word in regard trades union for the information of gentlemen who are opposed to them. In England the national associations committees in the different localities meet in the first, second, third, or fourth week of the month, and discuss the question of wages for the following month. That is the way it should be here. If the corporations and the men were to meet intelligently, all difficulties could be amicably adjusted, and that would be better for the corporations as well as for the men. I think that it behooves every workinginan to support the principle of trades unions and to push them along as best he can. Trades unions should be legalized in this country as well as in Great Britain.
The CHAIRMAN. Trades unions when badly conducted are very great evils. They should be wisely and intelligently conducted. I am glad to say that in England they have arrived at a development which in the main is creditable. The more intelligent the men are and the more disinterested the managers are, the better the results will be. It cannot be expected that trades unions will be respected when they lead to such outrages as the Molly Maguire outrages, at which the moral sense of the community revolts. I take it that every intelligent workman is as much opposed to mnrder and outrage and rapine as any employer can be. In consequence of the Molly Maguire outrages in the Schuylkill region property there has become almost worthless, because you can scarcely get a man to stay there as a manager. But the future of labor and capital in the whole country is, in my judgment, bound up in the maintenance of trades unions, their enlargement, and their intelligent action. When you get such organizations as that here, and when its representatives go in the proper spirit to the employers, and when the employers meet them in the proper spirit, then most of the difficulties will disappear.
Mr. CHISHOLM. Yes, sir; I believe that trades-unions, when headed by intelligent men, will succeed, but that they will collapse very shortly if they are not beaded by intelligent men.
Mr. THOMAS (to the chairman). Would it not be a good idea for such men as yourself, who hold those views, to advocate them?
The CHAIRMAN. I have handed you a pamphlet in which I have advocated them. Mr. THOMAS. I mean other men besides you.
The CHAIRMAN. Men have got to be convinced, and the only way that men can be convinced is by studying the question.
Mr. Rice. You will have a report from this committee which, I think, will be unanmous and which will express those views.
Mr. Thomas. Trades-unions are held in abhorrence by the employers, and we have been unable to create a sentiment in favor of them. We have asked the press to do so, but the press, as a rule, has gone entirely against the trades-unions.
The CHAIRMAN. The press, as a rule, expresses the views of those who snpport it.
Mr. THOMAS. That is it exactly. The corporations support the press, and they in strnct the press to carry ont their ideas.
The Chairman. You have got to rely on two things. You have got to have an organ of your own, and you have also got to rely upon growing intelligence. All this will contribute to bring about a better state of things. I have been aggravated once to a degree that I cannot state, by the action of a trades-union. It ordered a strike once from Pittsburgh, in the Trenton Mill belonging to Cooper & Hewitt. We did not know what the trouble was. The strike was ordered from Pittsburgh. I felt perfectly aggravated, as the men in the mill had not said a word about it. I ordered the works to be shat up, and said that I would never open them again until the order for the strike was withdrawn. Then Mr. Cooper saw a couple of the men, and in fire