Dennett Testifies in "Dick to Dick" Scandal

The House Committee on the Interior Department Expenditures heard testimony from Land Office Commissioner Fred Dennett today in what has been called the "Dick-to-Dick" scandal in Washington.  The scandal began several days ago when it came to light that Charles Taft may have asked his brother, the President, to remove Controller Bay in Alaska from the Chugach National Forest at the request of Richard Ryan, likely promoter of the Guggenheim interests in the territory, though Ryan has denied the allegation.

The story came to light in the July 7 Washington Times when the paper reported the discovery of the "Dick-to-Dick" letter by newspaper writer, Miss M. F. Abbott.  The letter sent last July from Ryan to then-Interior Secretary Richard Ballinger, a known Guggenheim collaborator, purported that Ryan would approach Charles Taft in order to change the president's opinion of Ryan:

Dear Dick: I went to see the President the other day about this Controller Bay affair. The President asked me whom I represented. I told him, according to our agreement, that I represented myself. But that didn't seem to satisfy him. So I sent for Charlie Taft, and asked him to tell his brother who it was I really represented. The President made no further objection to my claim. Yours, DICK.

Several months afterward, the President did remove Controller Bay from the National Forest through a secret Executive Order.  The order was sent to the General Land Office six days after it was issued.  That delay, between October 28 and November 3, 1910 allowed Ryan to get his paperwork together to establish a claim to enough property in Controller Bay to establish supremacy in the area.

Ryan has denied that he part of the Guggenheim Syndicate, a group led by Daniel Guggenheim, who are trying to establish control to coal fields in the Chugach National Forest.  After another scandal which led to Secretary Ballinger's resignation, their claims to the coal fields were rejected.  Controller Bay would be the natural harbor from which to ship material to and from the coal fields.  Ryan instead claims that he represents a competitor to the Guggenheim's in Alaska.

Commissioner Dennett's testimony focused on the legality of surveys conducted by the Ryan group shortly before the Executive Order was issued.  Unsurveyed lands are not subject to entry, and Dennett would comment on whether surveys conducted illegally could be submitted to the Interior Department.  The surveys had been approved, and were the basis on which Ryan submitted his claims.

In a related story, both the President and the current Interior Secretary, Walter Fischer, are back in Washington to deal with this growing scandal.  Both the Taft and Fischer deny knowledge of any "Dick-to-Dick" letter.  Secretary Fischer further stated that he and his staff searched all the files in the Interior Department and could find no such letter.  In fact, he believes that no such letter exists.

Miss Abbott's article on the Controller Bay scandal can be found in the May 21 issue of Collier's.

Link: House Committee Starts Hunt for "Dick-Dick" Letter [The Washington Times]
Link: The Latest in Alaska: Controller Bay and Its Control of the Alaskan Situation [Collier's]

Taft Promotes Arbitration Treaty in Atlantic City

The President was in Atlantic City, New Jersey to give a speech at the convention of the Young People's Society of Christian Endeavor at the Million-dollar Pier, a sea-side amusement park in the resort town.  The main hall at the Pier was filled to capacity with 14,000 spectators there to see the President speak.  Another hall nearby was filled with 6,000 more who were at least able to see the Chief Executive, even they couldn't be at his speech, but they did see Booker T. Washington speak.  At the main, after being introduced by the Christian Endeavor President, the Reverend Francis Clark, President Taft spoke at length about the impending arbitration deal with the country of Great Britain and how treaties just like around the world could reduces the changes of war in our lifetime.  Here is a section of his speech published in the Washington Herald:

We have ameliorated in many ways the ancient cruelties of war by Red Cross agreements, and by the immunity of private property on land from destruction. Now we are agreeing upon what is called the Declaration of London, which, if confirmed, as it seems likely to be, will take away from war on the sea those principles of lawful piracy that have always characterized in a naval war the dealing with the private property of the citizens to our enemies.

By negotiations and mediation and the formation of arbitration agreements wars in the last decade have been stopped in Central and South America in a most gratifying number of instances. I am glad to say that today we have reached such a point in the negotiation for a treaty of universal arbitration with one of the great European powers that we can confidently predict the signing of a satisfactory treaty.

Just today four great powers, England, Russia, Japan, and the United States, signed a fur seal treaty, by which we agreed in effect to abolish the shooting of seals at sea in order to preserve the valuable herds on the land and to allow them to propagate in such a way as to maintain the fur seal industry and to secure for human use the valuable furs that such seals furnish. It is the beginning, I hope, of useful game laws for the open ocean, which has heretofore been subject to the wanton and irresponsible use of men of every nation. It is the settlement by treaty of a controversy that has troubled these four nations for several generations, and it out to be the cause of great congratulation.

The arbitration treaty heretofore with Great Britain and other countries has excepted form the causes which may be arbitrated those which involved the vital interests of either party or its honor. The treaty which we are now closing with Great Britain eliminates those exceptions and provides that all questions of international concern of a justiciable character shall be submitted to the arbitration of an impartial tribunal, and that whenever differences arise befoer they are submitted to arbitration at all they shall be taken up by a commission composed of some representatives from each government that shall investigate the controversy and recommend a solution without arbitration, if possible, and then shall decide whether the issue is capable of arbitration, and if so the arbitration shall take place.

In this way the treaty in one sense, instead of making arbitration necessary, interposes mediation of a year between the happening of the differences and the bringing of the matter to arbitration, with the growing possibility that the ruffled feelings of the nation may be smoothed out by time, that the differences maybe adjusted by mediation instead of judicial action, but holding judicial action as the ultimate resort to prevent war.

I am exceedingly hopeful that other countries beside Great Britain will accept the form of the treaty or one like it, and that we may have half a dozen treaties with the European countries looking toward arbitration of international differences. This will not abolish war, but it will provide a most effective and forcible instrument for avoiding it in many cases.

Of course, war between Great Britain and the United States, between France and the United States, and between Germany and the United States is quite remote, but the adoption by other great countries of arbitration and mediation as a means of meeting all controversies must have the most healthy moral effect upon the world at large, and must assist all the friends of peace in their effort to make it permanent.

To this audience and this great society with its world-wide influence I do not hesitate to appeal to give the tremendous might of its support to such a cause.

Link: Thousands Hear President Taft Predict Peace [The Washington Herald]
Link: Taft Sure of Arbitration Pact [The New York Tribune]

Heat Wave Kills 500

According to the Bisbee Daily Review today, the heat wave that has gripped this country from the Great Plains to the East Coast has claimed the lives of at least 500 people, with at least 1,000 more hospitalized from heat-related symptoms.  The current wave began on July 1 and is only today expected to abate somewhat, with cooler temperatures definitely coming to the eastern seaboard tomorrow.  The torrid wave has led to numerous record high temperatures throughout the country, such as 108° F at street level in Chicago, 110° F in Lincoln, Neb., 113° F in Junction City, Kan., 95° F in Boston, 92° F in New York City, 108° F in Concordia, Kan, and 98° F in Washington, D.C.

At least 431 people have died from heat exhaustion so far in this heat wave, with another 80 drowning in their attempt to beat the heat.  The increased death rates in many cities have caused over-capacity at city morgues.  In Chicago, Express Trains are being used as makeshift morgues to process the heat wave victims.  This morning's New York Tribune reported that over 100 have died in that city from the heat wave so far with more expected today.

But all is not lost.  Heavy rains in the Great Plains and Midwest have brought some relief to those regions and those storms are slowly making their way east, hopefully clearing out the high-pressure system by the weekend.

Link: Three are dead; Heat Wave End to Come Friday [The Washington Herald]
Link: Fourth Day of Heat is Marked by 43 Deaths [The New York Tribune]
Link: 500 Killed by Heat; 1,000 Prostrated; Others Driven Insane in Many Cities [The Bisbee Daily Review]

French Postpone Official Response to Agadir Crisis

With French President Armand Fallieres and Foreign Minister Justin de Selves on their way to the Netherlands for an official state visit, it is unlikely that France will send an official response to the crisis in Morocco before he returns, though the dissatisfaction in Paris is increasing, according to the New York Tribune.  It is also clear that Germany isn't backing down at present.

The trouble began on July 1 when the German gunboat Panther arrived in the southwest Moroccan port of Agadir.   Official statements from the Kaiser's government have referred to this move as a necessary one to protect German citizens in the city from unrest in the country following similar moves by the French and Spanish to both protect their citizens and to prop up Moroccan Sultan Abdelhafid.  However, according to the Washington Herald, reports from the nearby port of Mogador suggest that the region around Agadir is "calm and tranquil."  Instead French, British, and Russian officials believe that this move is the first step in establishing the port as naval base for the German High Seas Fleet. 

If successful, this complete a trifecta of recent diplomatic coups by the German Empire including the establishment of naval base on the Mediterranean at Alexandretta in Syrian Turkey and the concession for the Berlin-to-Baghdad Railroad.  A port at Agadir would also help Germany compete in the markets of South America.  The Tribune pointed out in their article today that the voyage from Kiel, Germany to Buenos Aires is only 60 hours longer than trip from New York to the Argentine capital.

The New York Tribune's sources in Berlin seem to confirm this suspicion:

The step taken in Southwestern Morocco is merely to place Germany in a position to negotiate the best advantage in order eventually to obtain her long coveted naval depot and coaling station at Agadir, which has always been a favorite project of the Emperor William.

With the warship Panther already sent to Agadir, German officials now await the French response, though that is unlikely to come before they have consulted with their allies, Great Britain and Russia.  The Germans stated they would not remove the gunship until the French and Spanish expeditions to quell the uprising have been withdrawn.  The move has been viewed favorably in the Spanish press, though Spain has partnered with France in Morocco.  According to the Tribune's sources in London, the Spanish sought German intervention in order to force France to agree to a partition of Morocco among the great powers.

Link: French Protest to be Delayed [The Washington Herald]
Link: Germany Stands Pat; French Bourse Shaky [The New York Tribune]

Tremor Shakes San Francisco

In the biggest test to date of the rebuilding project in San Francisco, a 6.6 magnitude earthquake shook the city yesterday.  However, from all reports in the papers we watch, there doesn't appear to have been major damage or loss of life from the earth tremor.  There is some evidence for cracked and out of plumb walls, but nothing like the great calamity which struck the city five years ago.  The quake was felt as far away as Tucson, Arizona and Seattle, Washington.  In Carson City, Nevada, a hearing at the federal courthouse was adjourned outside after the lawyers had fled the building.

While nerves were certainly frazzled by the great shock of the earthquake and with the loss of telephone service, people began to gain some courage as the hours passed and it became clear that this would not be another 1906.

The mean time clock at observatory of the University of California was stopped by the quake for the first time since the great earthquake of 1906.

Link: Subdued Terror Grips Thousands in San Francisco [The Washington Times]
Link: Earthquake Again Jars San Francisco [The New York Tribune]
Link: Tremors Rock Pacific Coast [The Bisbee Daily Review]

Charges Filed in Wire Trust Case

Indictments were handed down yesterday in New York against nine wire industry associations.  They have been charged with violating sections one and two of the Sherman Anti-Trust Act.  Eighty-three men from thirty-five companies were named in the indictments, officers in the alleged illegal pools and combinations said to have the power to fix prices.  Included among them are Edwin Johnson, Jr. of New York who was named in each of the nine indictments as a supervisor and treasurer in the combinations, and William Palmer, who was named in seven of the indictments.  Palmer is the President of the American Steel and Wire Company, a subsidiary of the United States Steel Corporation, and is a director in the Steel Trust.  Herbert Satteriee, a son-in-law of J. P. Morgan, was also indicted, along with Frank Gould, president of the Old Dominion Iron and Nail Works, and Charles Morgan, a Republican Party Committee member from Connecticut.

The associations named in the indictments are: the Bare Copper Wire Association, the Wire Rope Manufacturers, the Underground Power Cable Association, the Weatherproof and Magnet Wire Association, the Horse Shoe Manufacturers' Association, the Telephone Cable Association, the Fine Magnet Wire Association, the Rubber Covered Wire Association, and the Lead Encased Rubber Wire Association.

The defendants have been charged with:

Entering into an unlawful combination and conspiracy to wrongfully and unduly restrain business, trade, and commerce in violation of Sections 1 and 2 of the Sherman Anti-Trust Law...

That all the times mentioned in this indictment the aforesaid corporations produced at their various factories in the aggregate 95 per cent of the entire amount of . . . steel wire product . . . consumed in the United States, and by association and co-operation they possessed the power to control and fix the price therefor within the United States;

That because said corporations, all such times, have been and, in fact, now are separate and distinct from each other, their said interstate business, trade, and commerce should have been and should now be conducted by each of them strictly on a competitive basis, and would have been and would so be conducted but for the unlawful combination and conspiracy by and among the aforesaid individuals . . .

As an example of the types of arrangements had, the New York Tribune looked at the case against the Bare Copper Wire Association. The Feds allege that on June 1, 1908, the defendants met in New York to form an illegal combination, which they used to conspire to restrict business and trade until the association was disbanded in November 1909.  The Feds allege that the association were to cause and procure the corporation to purchase, at arbitrary and non-competitive prices to be fixed and determined by the defendants, the raw material from which to make bare copper wire.  The prices were lower than they would otherwise have to pay or that corporations not in the association had to pay.  The bare wire that was manufactured was then sold at non-competitive prices that were higher than what it would otherwise had been sold for.

The Tribune had some reaction to the indictments from the defendents.  The supposed supervisor of the combinations, Edwin Johnson, is in Europe and could not be reached for comment but a person close to him at his office in New York said that Johnson was just the supervisor, and not the originator.  The counsels for the various companies involved signed off on the agreements and it wasn't until work had reached them that the government was investigating their associations that they began to be dissolved.  He went on to say that the associations were nothing more than social gatherings and no business was discussed at these parties among business associates.

The penalty provided by the Sherman Law is imprisonment not to exceed one year, $5,000, or both.

Link: U. S. Jury Indicts 83 Men, Officials of "Wire Trust" [The New York Tribune]
Link: Wire Trust Men Indicted by Jury in Combine Pact [The Washington Herald]
Link: Wire Trust Charged with Big Conspiracy [The Bisbee Daily Review]

Upcoming Smith Report to Show Extent of Steel Trust

It is expected that on Saturday, President Taft will submit a report to Congress by the Commission of Corporations, Herbert Knox Smith, on the extent of the Steel Trust and its effect on the steel industry. The expansive report is the culmination of a 5-6 year investigation conducted by the Bureau of Corporations.  The Washington Times suspects that the timing of the report's publication and submission to Congress is intended to allow it to share some of the public credit for dealing with the massive corporation.

According to the Times, the report will detail the business practices of the $1.4 Billion trust, how it has stifled competition within the steel industry, and how it has affected related industries such as coke, railroad transportation, and cement.  For example, the steel trust has bought up cement companies in order to prevent it from seriously competing against steel as a building material.  The Times compared this to the buying up of the beet sugar industry by the Sugar Trust.

According to the report, the Steel Trust was formed by a collection of iron, steel, coke, coal, and railroad companies that were combined by J. P. Morgan at the request of the owners of those companies.  Faced with intense competition from Andrew Carnegie who planned to build his own railroad to the Atlantic tide line, which would have made his Carnegie Steel Company as powerful as US Steel is today.  Carnegie would sell his company to US Steel in 1901.

Link: Steel Trust Mightest of All Combines [The Washington Times]
Link: Report of the commissioner of corporations on the Steel industry [Google Books]