Chapter XIV: The Great Panic

My investigations for “The Metropolis” had brought me several permanent friendships; for there are true and gracious people in New York “society,” as everywhere else. One of them was Edmond Kelly, who was not only a thinker and writer of distinction, but an international lawyer, known in all the capitals of Europe, and up to the time of his death the only American who had received the cross of the Legion of Honor in France. Kelly had been counsel for Anna Gould in her famous divorce suit, and told me the incredible story of Count Boni de Castellane. “The Metropolis” was being published in Paris, and causing a sensation there; as I read the eulogies of the French critics, I used to smile to myself, wondering what they would have said if I had made a book about the manners and morals of French “society,” as seen through the eyes of Edmond Kelly!

It happened that I was in New York in the fall of 1907, and was in Kelly’s study late one evening. I had to wait an hour or two for him, and he came in, deeply moved, and told me that he had just left the home of an old friend, Charles T. Barney, President of the Knickerbocker Trust Company, who was in dire distress. I had been reading in the papers for a couple of days wild rumors of trouble in this institution, which had built itself a miniature Greek temple at the corner of Thirty-fourth Street and Fifth Avenue. Now I got the inside story of what was going on. It appeared that the masters of high finance in New York, of whom the late J. P. Morgan was king, had determined to break these new institutions, the independent trust companies which were creeping in upon their preserves. Morgan had deliberately led Barney into entanglements, and had given him definite promise of support. That night, when called upon by Barney, he had repudiated his pledge; so the Knickerbocker Trust Company was doomed, several other trust companies would go with it, and the whole financial structure of New York would be shaken to the foundations. Kelly had promised even that late at night to make appeals in Barney’s behalf, so I left him. Next morning I read in the paper that an hour or two after Kelly had parted from him, the President of the Knickerbocker Trust Company had shot himself through the body.

So came the panic of 1907. Pierpont Morgan, having deliberately brought it on to tighten his hold upon the credit of the country, discovered that it was getting beyond his control, and by desperate efforts stopped it—for which action he became the hero of Capitalist Journalism in America. It happened that from two other independent sources I got the story, every part of which dove-tailed together. So I went about the streets of New York, knowing that this mighty master of finance, who was being crowned as a deliverer, was in fact a greedy old ruffian who had deliberately brought ruin to thousands of small business-men, and misery and want to millions of workers.

I had Kelly’s permission to tell the story in the form of a thinly veiled allegory, the meaning of which no one could possibly miss. I took the proposition to the “American Magazine,” which signed a contract with me to publish the story as a serial. I set to work to write it, but meantime the “American Magazine” must have begun to hear from Wall Street. It was not very long before John S. Phillips, editor of the magazine, was sending for me and pleading with me as a personal favor to let him off from this contract. I did so, and so ends the chapter of my dealings with another of our great organs of publicity.

I know no more pitiful story in the history of our Journalism than that of the “American Magazine.” It was founded because Lincoln Steffens, Ida Tarbell, Ray Stannard Baker and Finley Peter Dunne found they were no longer permitted to tell the truth in “McClure’s.” They purchased the “American,” assuming a debt of four hundred thousand dollars. Soon afterwards one of the assistant editors told me that they were having trouble in meeting their interest payments; and then came a crisis, plainly revealed in their columns. The magazine had begun the publication of a sensational series of articles, “Barbarous Mexico,” by John Kenneth Turner. These articles, since published in book form, and a second time suppressed, gave an intimate, first-hand account of the ferocities of the Diaz régime, under which American “dollar diplomats” were coining enormous fortunes. The “American” began the publication with a grand hurrah; it published two or three of the articles, and then suddenly it quit, with a feeble and obviously dishonest excuse—and poor Turner had to take his articles to that refuge of suppressed muck-rakers, the “Appeal to Reason.”

There must have been some crisis in the office of the magazine. Somebody had evidently had a “show-down,” the editors had been “taught their place.” Ever since then they have been a theme for tears. Ida Tarbell, who had torn the wrappings off the infamies of Standard Oil, has forgotten the subject, while Standard Oil, after a sham reorganization, has almost doubled the value of its stock, and more than doubled its plundering of the public. Ray Stannard Baker, who exposed the financial knaveries of the Beef Trust, shed his muck-raker skin and metamorphosed himself into “David Grayson,” a back-to-the-land sentimentalist—and this while the Beef Trust has multiplied four times over the profits it takes out of the necessities of a war-torn world! Finley Peter Dunne, who contributed the satires of Mr. Dooley and that withering ridicule of the idle rich under the name of “Mr. Worldly-Wise Man,” has apparently fallen silent from shame. Lincoln Steffens, the one man who stood by his convictions, quit the magazine, and now cannot get his real opinions published anywhere. The “American Magazine,” which started out to reclaim the industrial and political life of our country, is now publishing articles about how a little boy raises potatoes in a cigar-box, and how a man can become a millionaire by cobbling his own shoes.

I write these words in anger; but then I remember my pledge—the exact facts! So I go to the library and take down the first bound volume my hand touches. Here are the titles of a few “special articles” and “feature stories” from the “American Magazine” for January, 1918: “How We Decide When to Raise a Man’s Salary.” “What to Do with a Bad Habit.” “Are You Going Somewhere—or Only Wandering Around?” “The Comic Side of Trouble.” “Do You Laugh at the Misfortunes of Others?” “The Business-Woman and the Powder Puff: The personal story of one who has made a success and thinks she knows the reason why.” “What I Have Seen Booze Do.” “Interesting People: A Wonderful Young Private Secretary.” “A Barber Who Uses His Head.” “The Star in a ‘One-Girl Show’.” “From Prize-Fighter to Parson.”

Now I ask you: could any muck-raker in a rage make up a list of titles more completely expressive of vulgarity, commercialism and general “bunk” than the above real ones?

I was at this time planning the sequel to “The Metropolis,” called “The Money-changers.” The story of the 1907 panic fitted perfectly into my purposes, and so I made it the basis of this novel. Needless to say, I couldn’t get the “American Magazine” or any other magazine to publish it serially, nor could I get any respectable publishing-house to take up the book. I was forced to go to a fifth-rate concern, which afterwards went into bankruptcy. By the literary reviewers I was now practically boycotted; I had written a book of scandal, I had declassed myself as a man-of-letters. The fact that every word I had written was the truth, and that the men I pilloried were the plunderers of a great nation, made no difference whatever to the austere guardians of our literary traditions.

Since the year 1908, when “The Money-changers” was published, it has been the rule of American literary authorities that in discussions of American novelists my name is not mentioned. In 1914 Georg Brandes, the greatest of living critics, visited America, and to reporters at the steamer he made the statement that there were three American novelists whom he found worth reading, Frank Norris, Jack London, and Upton Sinclair. Every New York newspaper except one quoted Dr. Brandes as saying that there were _two_ American novelists he found worth reading, Frank Norris and Jack London. Dr. Brandes was puzzled by this incident, and asked me the reason; when I told him, he consented to write a preface to my next novel, “King Coal.” He spoke so highly of the book that I refrain from quoting him. But did his praise make any difference to American critics? It did not.

All the publicity “The Money-changers” got was from our “yellow” journals. The reader will understand that I despise these “yellows”; they are utterly without honor, they are vulgar and cruel; and yet, in spite of all their vices, I count them less dangerous to society than the so-called “respectable” papers, which pretend to all the virtues, and set the smug and pious tone for good society—papers like the “New York Tribune” and the “Boston Evening Transcript” and the “Baltimore Sun,” which are read by rich old gentlemen and maiden aunts, and can hardly ever be forced to admit to their columns any new or vital event or opinion. These are “kept” papers, in the strictest sense of the term, and do not have to hustle on the street for money. They serve the pocketbooks of the whole propertied class—which is the meaning of the term “respectability” in the bourgeois world. On the other hand the “yellow” journals, serving their own pocketbooks exclusively, will often print attacks on vested wealth, provided the attacks are startling and sensational, and provided the vested wealth in question is not a heavy advertiser. An illustration of what I mean is the following, which appeared in the “New York American” for September 6, 1908:

U. S. NAVY ADMITS ROTTEN ARMOR

Carnegie Co.’s Profit, $700,000

ADMIRAL MASON SAYS OREGON NOW CARRIES 400 TONS

Indiana, Massachusetts, New York and Others Also Have Defective Plates

FACTS HIDDEN 15 YEARS

Revelations in Upton Sinclair’s New Novel Are Fully Verified

Washington, Sept. 5—Rear-Admiral W. P. Mason, Chief of the Bureau of
Ordnance, in an interview today admitted that the battleship Oregon,
once the pride of the United States Navy, has carried since the day
she was built 400 tons of defective armor plate.

In addition the naval authorities reluctantly told that the conning
tower of the Oregon, which by expert testimony nearly fifteen years
ago was shown to be full of blowholes, is still on this vessel, which
may any day be called in defending the country against an enemy.

It is also known that the armor manufactured by the Carnegie Steel
Company, Limited, up to the latter part of 1893, which Hilary A.
Herbert, then Secretary of the Navy, recommended be stripped from the
Indiana, New York, Massachusetts and several other smaller vessels has
never been removed.

The investigation made by the “American” was prompted by the assertion
in Upton Sinclair’s new book “The Money-changers,” that “there are
ships in our navy covered with rotten armor plate that was sold to the
Government for four or five times what it cost.”

Referring to the investigation in 1893–94, which resulted in the
celebrated armor plate scandal, the author says: “Nothing much was
ever done about it. The Government could not afford to let the real
facts get out. But, of course, the insiders in the navy knew about it,
and the memory will last as long as the ships last.”

This part of the book is a bitter attack on several well-known men who
have been connected for years with the steel industry, and whose
identity it is easy to trace. It charges that at the time of the armor
plate scandal they bought out the Democratic party and secured the
support of a President of the United States.

And here is part of a second dispatch, which appeared in the “New York World” the following day. It is amusing to note how these two rivals, the “World” and the “American,” follow each other up!

Lake Placid, N. Y., Sept. 6—In an interview given by him today, after
he had been informed by his publishers and a representative of the
“World” of a report from Pittsburgh that William E. Corey, President
of the U. S. Steel Corporation, is to proceed against him for libel,
basing his action on charges contained in his new novel, Upton
Sinclair, who is spending the summer at Lake Placid, defied the “Steel
Crowd,” as he designated Mr. Corey and his associates, to do their
worst.

Mr. Sinclair declared he would welcome legal action on the part of Mr.
Corey, because it would give him an opportunity to place on record
evidence which he declares is in his possession concerning alleged
fraudulent acts of the steel men.

“I have not as many documents as I once had,” said Mr. Sinclair; “I
have not been able to replace some that were burned at Helicon Hall;
but I have more than Mr. Corey would care to see in print, I fancy.”

Mr. Sinclair said that among other documents in his possession before
the destruction of Helicon Hall by fire, were affidavits and other
papers pertaining to alleged fraudulent practices in connection with
the manufacture of steel rails.

“I took the trouble,” said he “to go out to Pittsburgh. I spent a
couple of weeks investigating. I had affidavits to prove that these
practices prevailed in the case of steel rails, a year or two before
E. H. Harriman gave out his statement as to the wretched quality of
rails which the Steel Trust was selling his railroads. I can tell Mr.
Harriman, too, that his own purchasing officials were not ignorant
about it.”

All this, of course, had little to do with literature. But it had something to do with Journalism, had it not? It had to do with matters of vital importance to the American people—battleships that could not fight, and steel rails that cracked and caused train-wrecks. How came it that all our organs of “respectability” kept silence, and left these grave matters to the despised “yellow” press?