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* THE NAV Y LEAGUE UNMASKED | -->
SPEECH
l º - - . OF
HON. CLYDE H.TAWENNER
- - - O]H' ILLINGIs
, - . •. in the : º
HOUSE OF REPRESENTATIVES
December 15, 1915
• *S* }
- €2 *
- • - - (".
• WASHIINGTON
GOVERNMENT IPRINTING OFFICE
. . . . 1916
24036—14942




S P E E CH
$ºr *-
II O N. C. LY DE II. T AW E N N E R.
Mr. TAVENNER. I believe that the House has started in On
this question of preparedness in the right way in permitting any
Member of this House who has ideas on the subject which he
desires to present to express them, whether he is on the side of
those who think that if we do not greatly increase our Army
and Navy appropriations the Republic will be destroyed from
without, or, whether he is on the side of those who think that if
the apprºpriations are greatly increased, as desired, we will
ultimately destroy the Republic from within. Let all the facts
come out ; let the people hear fully the arguments on both sides
Of this question. --
I hope and believe that if such a course is taken, when the
House tinally does settle this proposition, it will settle it in the
interest of the American people. [Applause. }
The particular point to which I wish to direct the atten-
tion of the House is that although war and preparation for
war mean an increased burden Of taxes for everyone, and
suffering and misery on every hand, it spells stupendous profits
to a very few gentlemen, but which few gentlemen are so re-
sourceful and wield so much power in this country that their
great profit because of war becomes a menace to peace and
therefore to all imankind. g &
I wish to read to the House from a weekly stock-market letter:
of a New York stock brokerage firm as to the extent of these
profits. This is the stock-market letter of the firm of Gilbert &
Elliott Co., of New York. I will not read the full circular but-
Only the headlines. . It is dated August 28, 1915. It says:
Winchester arms up 1,000 points, Colt arms up 100 points. Electric
boat up 100 points. Canadian explosives up 50 points. Du Pont de-
clares stock dividend of 200 per cent.
This is the stock-market report. Now, Bethlehem Steel
Stock at the Outbreak of the war could have been bought
for $40 and as low as $30. Yesterday Bethlehem Steel stock
Sold for $474. In other words, if you had had an invest-
ment of $40 in a share of Bethlehem Steel at the beginning of
the war, your profit because of war would have been $434. Py
this we may obtain some idea as to the staggering profits that
accrued to the Wall Street war trust magnates who owned
millions and Inillions of dollars worth of munition Stocks.
It is not to the financial interest of these men that the European
war shall be brought to a speedy close, but that it shall not be
2 24036—14942
... .Y.
.* }}
A.
*
9..*
3 .*
brought to a speedy close. It is not to their financial interest
that the United States of America shall not become involved in
the European war, but that it shall become involved. In one
. Of these stock-market letters it was stated that should the United
States become involved in the European war this stock would
be worth even double its present value, and it held out the hope
that there was a pretty good chance of the United States becom-
ing involved. What ‘ I am advocating is that the Government
take private profit out of war and preparation for war, so that
war will be no more profitable, and therefore no more attractive,
to the J. P. Morgans and the Other directors of the war traf-
ficking firms than it is to the rest of mankind. I assert that
war is altogether too profitable to these few men to be healthy
... for the rest of us. “ *
To read the large city newspapers one would think that the
United States of America has steadily neglected its Army and
Navy and that Congress has been very stingy in making appro-
priations. The truth is that the United States Government has
increased its appropriations for war and on account of war
faster than any nation on earth has ever increased such appro-
priations in time of peace. In the last 10 years we have spent
for war and on account of war $2,000,000,000—enough to pay
armor plate and powder.
... Off the national debt, dig the Panama Canal, and pay the expense
of every church and every school in the United States for an
entire year. And of every $100 that we have collected from the
American people we have paid $67 out for war and on account
Of war, and a very large slice of the money that we have appro-
priated for the Army, and Navy has gone to four firms, which
aup to this time have had a monopoly of the manufacture of
I want to Call attention to this fact : These $2,000,000,000
have been Contributed not by the rich, but largely by the poor,
• and I am going to try to make that plain if I can. -
Before I can do so I must correct the impression that existS
in the mind of the average man that some part of the taxes that
he pays his local tax collector is used for defraying the ex-
penses of the National Government, and that if he pays $20
to his local tax collector two or three dollars of it are Sent On
to Washington to maintain the expenses of the Government
and to maintain the Army and the Navy. LOCal taxes tre
used exclusively for local township, city, county, and State ex-
penses. The truth is that not a penny of the umoney that the
average citizen pays the local tax collector comes to Washington
to be used toward maintaining the Army and the Navy. Where,
then, did this $2,000,000,000 come from? It was not picked up
out of the streets. -
It was raised through two sources; through the internal-
revenue offices, where a tax is levied principally upon liquors
and tobaccos, and where now we are levying a tax upon incomes,
which raises, however, only 9 per cent of the total revenues.
The other Source from which we are raising the money to main-
tain the Army and the Navy is the customs tax on the things
that the people eat, wear, and use. So the people are paying
the cost of the maintenance of the Army and the Navy in the
form of the increased cost of living ; that is, they pay the tax
24036—14942 -. - -
4.
when they do not know it, and the local merchant collects the
tax without knowing that he is really a collector for the
Government,
Is it not obvious that since we raise this money almost wholly
by taxing the things that the people eat, wear, and use that
the more money we spend for the Army and the Navy the
higher the cost of living must be? The fact is that the cost of
living hos been increasing just about in proportion to the in-
crease in the cost of the Army and Navy, and it is bound to
Čontinue to do that unless we change our present System of
taxation. So I believe .that the greatest menace in this pro-
posal to greatly increase the appropriations for the Army and
Navy is that it will add bur(lens upon the taxpayers of this
country in the form of increased cost Of living. *.
Already, on the average, for every year Since 1897, the cos
of living has been going up much faster than the increase in
wages. If it continues to do that, and if we increase greatly
the appropriations for the Army and the Navy, there is going
to come a time when, the cost of living increasing year aſter
year faster than wages, the average working man in this coun-
try will be unable to support his family. It is an arithmetical
proposition: you can figure it out with pencil and paper. I
consider that such a condition as I have described would be a
greater danger to this ſtepublic than any danger from abroad.
I believe that if this Republic is in danger, it is in danger not
from the peoples beyond the seas, but from a clique of men
within this country who would tax the people until their backs
break, simply that they might make profit, Supplying battleships,
armor, and guns.
Mr. MILLER of Delaware. The gentleman is speaking of
additional taxation to be placed on the people on a CCOunt of the .
expenditure for the Army and Navy. He has introduced into
this Congress five bills, which, if enacted into law, would add all
additional expenditure of $1,165,000, With respect to the Rock
Island Arsenal in his own district.
Mr. TAWENNER. YeS.
Mr. MILLER of Delaware. May I ask him in that connection
if the War Department or the General Staff has asked for any
of this or whether it has been recommended in any report?
Mr. TAWENNER. No. I will answer that by saying that the
War Department would rather give contracts to the" J. P.
Morgan controlled war trust, although at the Rock Island Arsenal
we have manufactured certain materia's 54 per cent cheaper
than the prices we were paying the private manufacturers. If
you were going to buy $20,000,000 worth of an article, would
you pay 54 per Cent more for that article than you could manu-
facture it for yourself? 4- *
* * 3}: sk :: #: 35 +
Mr. TAVENNER. Two hundred and forty million dollars,
raised by taxing the American people, have annually been ex-
pended on the Army and Navy under the general assumption
that in return for this Colossal expenditure the Nation was
being reasonably “prepared.” But it is now asserted, even
by men occupying high and authoritative places in public life
and in a position to know what they are talking about, that
Our country is “pitifully and Irºpelessly unprepared ” and that
“if war were to break out to-day it would be found that our
24036—14942
5
coast defenses have not Suſſicient ammunition for an hour's
fight.” Surely to any thinking person this state of affairs must
suggest an indictment of the policy of giving the bulk of Army
and Navy contracts to private munition and shipbuilding con-
cerns. If we are not prepared as we should be, it is not because
the people have not paid in taxes the price of adequate prepara-
tion, but because too much of the money appropriated for pre-
paredness has gone into the pockets of the stockholders of the
war trafficking firms, some of which stockholders are men occu-
pying high positions in official life.
At least a hint as to what has become of the staggering sums
appropriated for preparedness is to be found in the fact that
four firms which have enjoyed practically a monopoly of the
large Army and Navy contracts have received since 1887 Orders
aggregating $200,000,000, and have been paid for their wares
from 20 to 60 per cent more than the same could have been
Imanufactured for in Government arsenals and navy yards.
It is possible to give definite and specific information as
to the economy of Government manufacture. The War De-
partment in 1913 purchased 7,000 4.7-inch shrapnel from
the ammunition ring, paying $25.26 each therefor. At the same
time precisely the same article was being manufactured in a
Government plant at a cost of $15.45. The War Depart-
ment paid the ring $17.50 for a 3.8-inch common shrapnel,
When it can manufacture the identical article for $7.94. The
Government has manufactured at the Rock - Island Arsenal
caissons for gun Carriages at a cost of $1,128.67, for which
private manufacturers had been paid $1,744.10, which is 54.6
per cent greater than the arsenal cost. Take powder. The Gov-
ernment has purchased $25,000,000 worth of powder from the
Powder Trust since 1905, paying therefor all the way from 53
conts to 80 cents per pound. We are manufacturing powder in
Government plants for 84 cents per pound, and the officers in
charge state that the more we manufacture the cheaper we
Can produce it. A hundred similar illustrations could be cited if
time permitted.
Mr. SABATH. Mr. Speaker, will the gentleman yield?
The SPEAKER pro tempore. Does the gentleman yield 2
Mr. TAVENNER, Yes.
Mr. SABATH. Where are these ammunition materials being
manufactured 2 Is if not a fact they are mostly manufactured
in the State of the gentleman who interrupted the gentleman
from Illinois a moment ago—in the State of Delaware? [Ap-
plause on the Democratic side. I
Mr. MILLER of Delaware, Mr. Speaker
Mr. TAVENNER. Of course, it is not “pork " when it goes
to the Morgan-controlled war trust,
Mr. CALDWELL. May I ask the gentleman if the arsenal
COStS include the overhead Charges?
Mr. TAVENNER. All overhead charges are included—even
some that should not be charged. Of course, it is a very
strange thing, but the Army officers do not want it to appear
that they are manufacturing things too cheaply at the Govern-
ment arsenals, because they-Want to give as much business as
possible to private manufacturers.
Secretary of the Navy Daniels in his annual report for 1914
Called attention to the economy Of Government manufacture
24036—14942
wº, 3
6
by saying that, “contrary to popular idea, the Navy Depart-
Iment in What it manufactures does so, from a superdreadnaught
to a gallon of paint or a pound of powder, cheaper than the
Same can be purchased. This is particularly true of the most
expensive instruments of war, but it is equally true of gasoline
engines, electrical Supplies, engines for dreadnaughts, shrapnel,
Clothiug for marines and Sailors, accouterments, and a multi-
tude of other articles required for the fleet and shore stations.”
Government manufacture will mean that the workmen who
perform the labor of actually making the munitions will receive
higher wages and better working conditions than if the con-
tracts for war materials are awarded the private munition
firms, among which are numbered the most bitter enemies of
Organized labor in the United States. .
Right at this point I want to read something from the report
of an official Government investigation as to the working con- .
ditions at one of the plants receiving a large part of the Gov-
ernment business—the Bethlehem Steel Co.
The inquiry was made by the United States Bureau of Labor
in 1910, under the direction of Ethelbert Stewart, a special
agent of the Labor Bureau at the time, who bore the reputa-
tion of being one of the most experienced economic investigators
in the COuntry.
The Government investigation revealed this :
That out of every 100 men 29 were working 7 days every
Week. <e
That out of every 100 men 43, including these 29, were Work.
ing some Sundays in the month. -- .
That out of every 100 men 51 were working 12 hours a day.
That out of every 100 men 25 were working 12 hours a day 7
days a week.
That out of every 100 men 46 were earning less than $2 a day.
Working men of the Nation, are you willing that your Govern-
ment shall continue to give Contracts running into millions
annually to firms that have mistreated and underpaid their em-
ployees as have these great war-trafficking concerns? If you
are not willing, then protest against it. But let me assure you
at the outset that one protest will not be sufficient. The chances
are you will have to speak loud and often before your voice
will be heard in far-off Washington.
DEMAND FOR GOVERN M DNT MANUFACTURE IS GROW IN G.
Practically all of the peace societies of the world which do not
have on their boards of directors or in their memberships stock-
holders in the private war-trafficking firms, have declared in
favor of the nationalization of the manufacture of munitions
of war, on the theory that if private profit and private graft
are taken out of militarism the incentive for at least that por-
tion of the systematic agitation for increased military appro-
priations inaugurated by those who directly or indirectly profit
from the sale of war materials will have been relmoved and
an important step taken in the direction of peace. Government
manufacture of war materials was also indorsed by the Ameri-
can Federation of Labor at its convention in Philadelphia in
1914.
Nationalization of the manufacture. Of war paraphernalia
offers a program on which all save those directly or indirectly
interested in private war-trafficking concerns may unite,
24036—14942
7
Whether in favor of disarmament, vastly increased armament,
or maintaining the present armament, all can meet on a common
ground. Those who desire a greater armament can obtain it
through Government manufacture without placing increased
burdens upon the taxpayers.
- If those who demand such a large Army and Navy are wholly
sincere, and if their only desire is that we shall bave the strong-
... est possible Army and Navy, why should...they not want us to Ob-
tain the maximum defensive power or the maximum striking
power for every dollar we appropriate, instead of only about 65
cents worth of fighting strength for every dollar appropriated?
. . . . By manufacturing armor, munitions, submarines, aeroplanes,
and so forth, in its own plants the Government will be able to .
keep for its own use any improvements in such vehicles of war.
ljnder the present policy of giving the major part of military Con-
tracts to private concerns it has been impossible to do this.
“Even now,” says Secretary of the Navy Daniels, “the improve-
ments in armor and the designs worked out by the Navy have
been embodied in the warship of another nation recently finished
by the Bethlehem Steel Co. and put into commission. This is
- not an argument lightly to be disregarded in favor of a Govern-
* Mr. FOCHT. Mr. Speaker
ment armor plant, nor has it been overlooked, for instance, by
Japan, which has erected its own armor-making plant and sur-
rounded it with such secrecy that none of the other mations is
able to tell whether or not at this minute the Japanese armor
may not be superior to any other in existence.”
Mr. TAVENNER. Mr. Speaker, I must refuse to yield. Under
the present system the Government is at the mercy of a few con-
cerns having a monopoly of the manufacture of the materials
of war, who appear to have a gentlemen’s agreement to divide
the Government contracts between themselves and between
whom there is no competition’ worthy of the name. “I do not
see how it is possible for Congress to justify to the people a
refusal to erect a Government plant,” said Secretary Daniels to
Congress, “nor how it can answer the charge that will invari-
ably be brought up—that the same mysterious providence
which saved this profitable business to the steel companies three
times in the past, even after money for a Government plant had
actually been appropriated, is not still at work exercising its
beneficent protection over these lusty specimens of infant in-
dustries, who are even now (inder Government investigation as
violators of the antitrust law.”
It is argued by some who oppose Government manufacture as
a policy that the Government should give to private manufac-
‘turers Čontracts in time of peace in order that they may be relied
upon for patriotic cooperation in time of war.
But what are the facts? When war with Spain was imminent
the three concerns in this country which have a monopoly of
the manufacture of armor plate got together and practically
issued an ultimatum to their own GOvernment, the United States
Government, that they would not manufacture a single piece
of armor plate unless we should agree to pay them $100 a ton
more than the price fixed by Congress after an investigation as
to a fair price. But their patriotism did not prevent tº em from
selling armor plate to the Russian, Government for $249 a ton
while they were asking of their own Government $616 a ton.
IApplause on the Democratic side.] •
24036—14942
& 8
Mr. DAVIS of Texas. Amen: , ~.
Mr. TAVENNER. The present European war has demon-
Strated that private plants not in the business of manufacturing
Wal' materials, Can make the necessary alterations to manufac-
ture such supplies in a remarkably short space of time. By en-
larging the Government plants and operating them in time of
peace, the Government could have on hand sufficient ammunition,
guns, and so forth, to equip the most powerful army ever organ-
ized and keep it in the field a long time after private plants, not
engaged in the manufacture of war materials, would have been
able to reorganize their shops and be turning out ammunition
and other supplies. In the event that private manufacturers
should not respond to the necessity of the occasion, the Govern-
iment could itself take over such industrial plants as it might
need just as England has done. * * -
Now, I want to go a little further into the patriotism of some
Of the firms that have a monoply of the manufacture of war
materials in this country and to take up particularly the single-
ness of the patriotism of the Du Pont Powder Co. -
Here are two paragraphs in the world agreement entered into
in 1897, which agreement was used by the Government in its
suit against the Du Pont trust: . - - -
Whenever the American factories receive an inquiry for any Govern-
ment other than , their own, either directly or indirectly, they are to
communicate with the European factories, through the chairman ap-
pointed, as bereinafter set forth, and by that means to ascertain the
price at which the European factories are quoting or bave fixed, and
they shall be bound not to quote or sell at any lower figure than the
price at which the European factories are quoting or bave fixed: Should
the European factories receive an inquiry from the Government of the
United States of North America or decide to quote for delivery for that
Government, either directly or indirectly, they shall first in like manner
ascertain the price quoted or fixed by the American factories and shall
be bound not to quote or sell below that figure.
sº & & * tº - º sº alº
The American factories are to abstain from manufacturing, selling, or
quoting, directly or indirectly, in or for consumption in any of the
European territor v. and the Europeans are to abstain in like manner
from manufacturing, selling, or quoting, directly or indirectly, in or
for consumption in any of the countries of the American territory.
With regard to the syndicated territory, neither party is to erect works
there, except by a mutual understanding, and the trade there is to be
carried on for joint account in the manner hereinafter defined.
SHALL PREPAIRED NESS BE PAID BY LABOR 2 -
Now, a few words as to the plan which has been submitted
to raise the money with which to defray the proposed tremendous
increases in appropriations for the Army and Navy."
It is proposed to meet the cost of “preparedness.” by taxes
On Sugar, On gaSO line, and by other ſlirect taxes which bear
heavily upon labor. It is also proposed to continue the present
indirect taxes on the things people use, which yield $620,000,000
a year. It is proposed to burden the worker and farmer by taxes
On the things they consume, and spend the proceeds on arma-
ment, with colossal profits to the armament ring, for an Army
and Navy to protect principally the things that privilege owns.
wh Y TAX LABOR 2. -
First. Why tax labor when, according to the report of the
Commission on Industrial Relations, from between one-third
and One-fourth of the male workers 18 years of age and Over in
factories and mines earn less than $10 per week, while from
two-thirds to three-fourths earn less than $15 per week; when
24036—14942
9
2 per cent of the people own 60 per cent of the wealth, and .
65 per cent own only 5 per cent of the wealth.
Why not compel 2 per cent of the people to pay 60 per cent
of the taxes instead Of making the great mass of the people,
who own 5 per cent, pay 95 per cent of the taxes?
Second. Why tax labor when war-munition Stocks have in-
creased in value in One year by $866,000,000? *
Third. Why tax incomes in America but $80,000,000, when
incomes in Great Britain, even before the war, paid $236,245,000?
England contains less than One-half our population and wealth.
All told, England taxed wealth, incomes, and inheritances to
the extent of $380,115,000, and collected 45 per cent of her total
revenues from these SOUlrces. Democratic America Collected 9
per cent of its revenues from wealth, incolnes, and inheritances.
Fourth, Why tax labor on its necessities, on the things it
needs to merely live, when inheritances have not as yet been
taxed a penny by the Federal Government?
Fifth. Great Britain taxes incomes up to 333 per cent for war
purposes; Germany levies taxes for in perial purposes, for state
purposes, and for municipal purposes as well; the combined rate
running Often to 15 per cent or 20 per cent. Democratic America
taxes incomes from 1 per cent to 7 per cent, the maximum up to
$100,000 being but 4 per cent.
A tax of $10 to the wage earner means giving up clothes, food
from his table, possibly the doctor for his children. A tax of
$10,000 to a man with an income of $100,000, or $100,000 to a
man enjoying an income of $500,000 means no sacrifice whatever.
Sixth. Why tax labor, when an additional tax of 1 per cent
on the gross earnings of railroads, public-service corporations,
mines, and other public utilities would yield $50,000,000. It
could be easily collected. It could not be escaped. In most
instances it could not be passod on to the consumer.
Seventh. Preparations for war should call for equal sacrifices.
Defense should not mean sacrifice for the millions, and only
profits for the few. Preparations for war mean profits to the
railroads, to mine OWI)ers, munition factories, banks ; it means
speculative values for the stock - brokers and speculators. It
means that the bended backs of labor will carry the Army and
the Navy, which, if the emergency ariscs, will be used against
labor at home and for the protection of Ovcı’-Seas investments
abroad.
THIE DISINTERESTED PATRIOTISM OF THE NAVY LEAGUI).
Mr. TAVENNER. I believe in giving credit to whom credit
is due. For instance, the gentlemen back of the Navy League,
in my opinion, deserve full Credit for the sentiment that has at
last been (leveloped in many quarters of the United States for
increased appropriations for the Army and Navy. They deserve
ſull credit ſor the sentiment that has been aroused in the largo
Imanufacturing centers and other parts of the United States for
the proposed $500,000,000 bond issue for battleships that the
Navy League has been advocating. I am in favor of giving the
Navy League ſull credit and also full responsibility.
On November 19 I made the statement, publicly, that I in-
tended to introduce in Congress a resolution to investigate the
Navy League and to require J. P. Morgan, one of the directors
of the league, to take the responsibility of testifying under oath
as to whetlier Ihe is interested in War-traſſicking firms.
24036—14942
--
--
10
Mr. HENSLEY. Will the gentleman yield right there? Is
it not a fact that J. P. Morgān, the head of the Morgan banking
house of New York as well as the controlling factor in many of
these munition plants in this Country, is the accredited British
agent in all munition matters? And is he not receiving from
the British Government 2 per cent commissions on all sales of
this kind to the warring nations? *~
Mr. TAVENNER. He is minister of munitions to the Court
of St. James. That is his title. [Applause and laughter, J
Mr. HENSI,EY. The sales of nuunitions already made, it is
Said, amount to two billions of dollars, and 2 per cent profitS
would represent forty millions of profits up to date.
Mr. TAVENNER. In a letter sent to Members of Congress,
dated January 13, 1914, A. H. Dadmun, secretary of the Navy
Ileague, said :
Certain Congressmen have insinuated that the league is supported by
people who are interested in the sale of ware materials to the Navy.
They are entirely mistaken
Mr. Dadmun, in a letter published in the January, 1916, issue
Of Pearson's Magazine, reiterates that, the men back of the Navy
League “are men who will not prºfit by the results of the
league’s propaganda.”
What is this Navy League? Who founded it, and who are
its directors? I hold in my hand the bound Navy League Jour-
nal for 1904. In the opening number is the statement that this
is “ the official organ of the Navy League of the United States.”
I turn now to page 32 of the issue of February, 1904, where
I finá a list of 19 men who are named as the “founders ” of the
Navy League. Now, then, let us see who they are.
I note in the list of founders the name of the Midvale Steel
Co. The United States Government since 1903 has bought from
the Midvale Steel Co. 48,399 tons of armor, and we have paid
for it an average of $420 a ton, or in all $20,375,858 for the
Single item of armor plate alone, not to say anything about
Other millions Of Ciollars’ worth of contracts that have been
given to the Midvale Steel Co. for other things used by the
Army and the Navy : and if the Navy League's proposed $500,-
000,000 bond issue goes through, Midvale will stand to draw
down SOme more millionS.
Let us see if there are any more war traffickers here. Is
Charles M. Schwab, whom I see listed as one of the founders,
a war trafficker? Well, he is president of the Bethlehem Steel
Corporation, and we have bought from Bethlehem 95,007 tons
of armor at an average rate of $445 a ton, and have paid
Bethlehem for armor plate alone $42,344,937. That is the second
member of the armor ring.
Now, there is another member of the armor ring, and that is
the Carnegie Steel Co. Let us see if we find them also among
the founders of the Navy League. Yes : I see here the name of
J. P. Morgan. The late J. P. Morgan was the organizer and a .
director of the United States Steel Corporation, which controls,
according to Moody’s Manual, the Carnegie Steel Co. We have
bought from the Carnegie Steel Co. 89,933 tons of armor plate,
paying an average of $442 a ton, or a total of $39,783,497 for
the single item of armor plate; and if the Navy League's pro-
posed $500,000,000 bond issue for battleships goes through they
will receive still larger contracts. So that you see the three
24036—14942
tº
sº
, 11
-firms which have a monopoly of the manufacture of armor
N
-
,42°
in this country are all founders of the Navy League; they are
all represented as the founders of the Navy League, and we have
bought from them 233,339 tons of armor plate, paying for it
an average of $439 a ton, or a total of $102,504,292.
, Mr. FARIR. For how long? &
- Mr. TAVENNER. Since 1887. Remember that figure, $4391
There have been 10 official estimates by Government officials as
to the cost of armor plate in a Government factory, and the
average of those estimates is $251 a ton ; and had we manu-
factured this armor in a Government factory, which the Navy
League has cold shouldered, I think I am well within the
bounds Of conservatism when I say we could have Saved to the
American taxpayers at the very least $35,000,000.
The Harvey Steel Co., which owned the patent on a process
for hardening steel which compelled all manufacturers of armor
plate to pay it a royalty, was in on the ground floor at the
organization of the Navy League, in the persons of S. S. Palmer,
its president, and Benjamin F. Tracy, ex-Secretary of the Navy.
Mr. Trady was the counsel for the Harvey Co. and the Carnegie
Steel Co. after leaving the Navy Department. Both Palmer and
Tracy were also among the 19 founders.'
Throughout the existence of the Navy League there have been
several distinct groups represented, made up of officers, directors,
attorneys, and employees. The most important of these are the
J. P. Morgan group, the Bethlehem Steel group, the Carnegie
Steel group, the Midvale Steel group, the Harvey Steel group,
and last, but not least, Col. Thompson’s International Nickel
Co. group. These groups will be found well represented in the
league's officers, directorates, contributors, and vice presidents
for each and every year Since the birth of the Navy League in
1902.
There are 19 men in the list Of founders, and Of those 19 the
majority were connected with concerns and establishments
which, through interlocking directorates, connect in turn with
manufacturers of War materials and things which go into war
materials. T *. -
-Now I come down to the officers of the Navy League to-day.
The president of the league, Col. Robert M. Thompson, the
gentleman who was unkind enough to threaten to sue me but
not kind enough to do it [applause on the Democratic sidel, is
Chairman of the board Of Clirectors Of the International Nickel
Co., the business of which, according to the Wall Street Journal,
has been very much improved by the war.
The Clirectorate. Of the International Nickel Co. interlocks
with that of the United States Steel Corporation, Edmund C.
Converse sitting as a 'director on both concerns. United States
Steel controls the bulk of the steel industry in this country, and
is capitalized for $1,512,000,000, while International Niekel con-
trols the greater part of the nickel lands of the North American
Continent, and is capitalized at $47,000,000.
Col. Thompson, as president of the Navy League, was a
happy selection indeed, because the steel, nickel, and copper in-
terests, all of , which will profit handsomely through war and
preparation for war, interlock beautifully through him and his
International Nickel Co. W. A. Clark, the Montana “copper
24036—14942
º:
-
12
king,” is president of the Waclark Wire Co. and Col. Thompson
is one of his directors on that corporation. Then, too, Col.
Thompson is president of the New York Metal Exchange.
Col. Thompson's International Nickel Co. also interlocks with
the Midvale Steel & Ordnance Co., W. E. Corey being a director
of International Nickel and president and director of the new
Midvale corporation, which was organized recently for $100,-
000,000 especially to handle the growing war-trafficking trade,
and is one of the largest war-trading firms in the United States.
Mr. Corey only recently retired from the presidency of the
Carnegie Steel Co. and from the board of directors of United
States Steel. One of the underlying concerns of the new Mid-
vale company is the Hemington Arms Co., which has a contract
to manufacture 2,000,000 Enfield rifles for the British Govern-
Inent. &
The International Nickel Co. also interlocks with the Midvale
concern through Ambrose Monell, who is president of the Inter-
national Nickel Co. and a director of the Midvale Steel &
Ordnance Co. * *
Seward Prosser, another director of International Nickel,
is one of the contributors to the funds of the Navy League
which have been used to banquet Secretaries of the Nayy and
Members of Congress,”hire speakers, and carry on the elaborate
campaign for “preparedness" which the Navy League has been
Carrying on Dmost earnestly for the last 13 years, and which.
promises now to bear fruit in the form of staggering increases
in Army and Navy appropriations.
International Nickel also interlocks directly with the United
States Navy Department, through W. H. Brownson, retired
rear admiral, who is a director Of the International Nickel Co.
and on the pay roll of the Government at a salary of $6,000 a.
year, which is three-fourths full pay. “Who’s Who " for 1914–
15 gives Admiral Brownson's address as “Navy Department,
Washington, D. C.” Admiral Brownson is, no doubt, of more
value to the International Nickel Co. in Washington, where he
Comes into intimate contact with fellow naval officers, than he
WOuld be any place else. *
Are there any reasons, other than purely patriotic ones, why
officers and directors of the Nickel Trust might be urging,
through the Navy League, a $500,000,000 bond issue for battle-
ships, and so forth 2 Light may be had on this subject by re-
ferring to a table to be found on page 5259 of the CoNGRESSIONAL
RECORD, last session. The table in question is headed “Metal
per ton of armor,” and is a part of the report of Senator TII.L-
MAN, Representative PADGEtt. and Admiral Strauss, of the
Navy Department, as to the cost of manufacturing armor plate,
This table states that of every $5.274 worth of metal used in
the manufacture of armor plate $2,953 represents the value of
the nickel scrap and $1,466 represents the value of the metallic
nickel used in the manufacture of armor. r p *
Nor is the use of nickel confined to armor plate. It goes into
ammunition hoists, communication tubes and turrets, deck,
hull, and ship plates, guns and gun shields, rifles and small
arms, torpedo air reservoirs, marine straight-line shafting,
crank Shafts, piston rods, and other marine-engine forgings.
As to whether the International Nickel Co. is a war traºfficker,
24036—14942
.* *
*.
• * * ,
13
the Wall Street Journal, March 23, 1915, has the following to
Say :-
As a result of the demand for cartridges and shells, the International
Nickel Co is receiving unusually large orders for nickel. The metal is
necessary in the manufacture of the various kinds of ammunition, and
the various manufacturers of munitions, such as Bethlehem Steel Cor-
poration, Remington Arms, and Union Metallic Cartridge Co., have
found it necessary to increase their supply of nickel. *
The Wall Street Journal of May 22 reported that the busi-
ness of the Nickel Trust was soaring higher and higher, and
that the “increase in business was mainly due to the war.”
International Nickel advanced nine points in one day.
Nickel is used in the Imanufacture of Subinarilles to a con-
siderable extent. It is nade use of, according to the Wall Street
Journal, in the new electric batteries for submarines, invented
by Thomas A. Edison, which will prevent the generation of
chlorine gas. In this instance the nickel supplants lead. An-
other source of increased revenue is the high price of copper.
The company’s ore recovery is estimated to be about 70 per cent
nickel and 30 per cent copper. The company owns the most
extensive known existing nickel Ore deposits. Its patented nickel
lands in Ontario, Canada, cover 100,000 acres, and in addition
to this the company owns the town of Copper Cliff. It also
Owns the shares of the Societe Miniere Caledonienne of New
Caledonia, which company owns extensive nickel lands. These
lands, it is estimated, will furnisli the company with at least
60-years' ore supply. Earnings during the months of June, July,
and August, according to well-informed interests, were at the
- rate of between 25 per cent and 30 per cent a year on the com-
\mOn Stock.
Thus it will be seen that the head of the Navy League has the
nickel, plenty of it, enough to last for 60 years. All that re-
mains to be done is to get Uncle Samuel to buy it. If Col.
Thompson can mafiage to put through the Navy League's pro-
posed $500,000,000 bond issue for battleships, and so forth, per-
haps the Nickel Trust will be able to pay even 50 per cent or 60
per cent on its common stock. If there is any more profitable
way for the head of the Nickel Trust to spend his time than in
Washington pointing out to the Senators and Congressmen the
frightful insecurity of the Nation, it would be interesting to
know how he could do it. It need not be said that he is not a
great patriot, and it can not be said that he is not a great busi-
ness Inan. It is not every man who can make patriotism a
business and make it nay 20 per cent or 80 per cent
CONNIUCTING LIN RS BETWEEN THE NAVY I, EAGUR AND TTI tº HOUSE OF
J. P. M G RGAN & Co., 23 WALL STREET, NEW YORK.
The Navy League upon close examination would appear to be
little more than a branch oſſice of the house of J. P. Morgan & Co.
and a goneral sales promotion bureau for the various armor and
munition makers and the steel, nickel, Copper, and zinc interests.
At least, they are all represented among the directors, officers,
foundlers, or life members of or contributors to the Navy IJeague.
Especially are all forms of big business represented, and big
business invariably heads in at 23 Wall Street, New York.
J. P. Morgan was formerly treasurer of the Navy League and
is now a director and contributor. He is a director also of the
United States Steel Corporation and many other corporations,
24036—14942
14
Herbert L. Satterlee, former Assistant Secretary of the Navy
Department and a brother-in-law of J. P. Morgan, was one of
the incorporators and founders Of the Navy League and is the
present general counsel of the league.
The late J. P. Morgan was one of the founders and principal
contributors to the Navy League, and as late as June 10, 1915,
$2,000 was subscribed on behalf of the Morgan estate.
Edward T. Stotesbury, a member of the firm of J. P. Morgan
& Co. and a director of the Baldwin Locomotive Works, and
until recently a director of Cambria Steel Co., Phoenix Iron Co.,
Riverside Metal Co., Temple Iron Co., Wm. Cramp & Sons Ship
& Engine Building Co., and 54 other corporations, banks, and
trust companies, is one of the honorary vice preside.nts of the
Navy League. The Wall Street Journal on July 26, 1915, re-
ported that the Baldwin Locomotive Works had received a war
order for $80,000,000 worth of shells and other munitions.
Robert Bacon, former Secretary of State and partner of J. P.
Morgan & Co. and first director of the United States Steel Cor-
poration, is a director of the Navy League.
Henry C. Frick, a fellow director of J. P. Morgan on both the
United States Steel Corporation and the National City Bank
Of New York, is an honorary vice president of the Navy League.
Jacob H. Schiff, a director with J. P. Morgan on the National
City Bank of New York, contributed $1,000 to the Navy League
June 10, 1915.
J. Ogden Armour, a director with J. P. Morgan on the National
City Bank of New York, was one of a committee which, under
the auspicos of the National Security League, issued a state-
ment certifying as to the patriotism of the Navy League.
Cleveland H. Dodge, a director with J. P. Morgan on the Na-
tional City Bank of New York and a director of the American
Brass Co., Commercial Mining Co., Copper Queen Consolidated
Mining Co., Detroit Copper Mining Co. of Arizona, Lackawanna
Iron & Coal Co., Montezuma Copper Co., and the United Globe
Mines, is a life member of the Navy League. Marcellus H. Dodge,
a nephew of Cleveland H. Dodge, is a director on the boards of
the Remington Arms-Union Metallic Cartridge Co. and the
Remington Arms & Ammunition Co. Cleveland H. Dodge is
vice president of Phelps, Dodge & Co. (Ltd.), a $45,000,000
corporation, which is one of the leading factors in the copper
industry in the United States. Although the millions of Cleve-
land H. Dodge have been multiplied through the increased
value of his copper holdings as a result of the European war,
his firms appear unwilling to share their prosperity with their
miners in Arizona. Some 5,000 copper miners are now on
Strike, and because Gov. Hunt, of Arizona, has dared to protect
them against an invasion of lawless thugs and strikebreakers,
the mine Owners are circulating petitions for his recall. The
leading corporation involved in the Clifton-Morenci strike is
Phelps, Dodge & Co. of which Cleveland H. Dodge is vice
president. The company in 1912 earned 23 per cent on its
capital of $45,000,000 and paid a 15 per cent dividend. To-day
copper is higher than at any time in nine years, yet the conn-
pany refuses to grant its men a wage increase or to make any
concession. The principal property of the company at Clifton
paid in 1912 a dividend of 1463 per cent on a capital of $1,000,000.
Joseph P. Grace, a director, with J. P. Morgan on the National
24036—14942 *
15 •
City Bank of New York, is one of the contributors to the funds
of the Navy League. - * *-
George F. Baker, jr., a director of the First National Bank
of New York and a son of a director of the United States Steel
Corporation, contributed $1,000 to the Navy League June 10, 1915.
Allan A. Ryan, a director of the Bethlehem Steel Corpora-
tion, is a contributor to the Navy League, and George R. Shel-
don, another director of the Bethlehem Corporation and also a
director Of the American LOCOmotive Co., both of which Con-
cerns have profited hugely from European war orders, is an
honorary vice president of the Navy League. Considering that
Charles M. Schwab, the president of Bethlehem, is one of the
founders of the Navy League, it would appear that this war-
ti-afficking firm has full representation in this organization.
And it always has been well represented. Robert H. Sayre, a
former general manager of Bethlehem, was a life member of the
Navy League, and Lieut. J. F. Meigs, who left the Navy Depart-
ment to go into the employ of Bethlehem, was also a life member.
Beekman Winthrop, a former Assistant Secretary of the Navy
and now a director of the Lackawanna Steel Co., is a director
of the Navy League. - -
Former United States Senator W. A. Clark, the “copper king
of Montana,” is a director of the Navy League and a director of
the W. A. Clark Titanite Explosive Co., Colusa-Parrot Mining &
Smelting Co., Equator Mining & Smelting Co., Henry-Bonnard
- Bronze Co., Mayflower Consolidated Mining Co., Moulton Min-
ing Co., Ophir Hill Consolidated Mining Co., Original Consoli- .
dated Mining Co., Sunset Mining Co., United Verde Copper Co., ...
... and 26 other corporations.
Charles F. Brooker, honorary vice president of the Navy
League, is president and director of the American Brass Co.
and a director of the United States Smelting, Refining & Min-
ing Co., Westinghouse. Electric & Manufacturing Co., Mechanics
& Metals National Bank of the city of New York, and 15
other banks, trust companies, and corporations. On April 10,
1915, Mr. Brooker also owned 474 shares of Bethlehem Steel,
which was worth $40 a share previous to the outbreak of the
European war, and went as high as $600 on October 22, 1915.
- Lewis L. Clarke, treasurer of the Navy League, is a director
of the American Locomotive Co. The Standard Corporation
- Service on May 3, 1915, 1-eported that the American Locomotive
Co. had concluded negotiations with the British Government
% the manufacture of 5,000,000 shrapnel shells to cost $66,-
50,000. - -
A. Barton Hepburn, honorary vice president of the Navy
League, is a director of the American Car & Foundry Co., which
has received large munitions contracts from the allies.
Henry P. Joy, vice president of the Navy League, who opposes
Government manufacture of war munitions, is president of the
Packard Motor Car Co., which has received large Orders from
the allies. -
T. Coleman du Pont, president of the Du Pont de Nemours
Powder Co., was formerly a vice president of the Navy League.
The du Ponts have managed to maintain a monopoly of the
... Sale of, smokeless powder to the United States Government, and
have received some $25,000,000 worth of contracts in the last
10 years. -
- 24036—14942
*
16 Ar
I do not desire to make the charge that President Thompson
and Secretary Dadmun, of the Navy League, are deliberately
falsifying in insisting that this purely patriotic organization
is backed by “men who will not profit by the league's propa-
ganda,” because it is possible that they have reiterated this
view so often that they have come to actually believe it them-
Selves. I doubt, however, whether they can Čonvince the Amer-"
ican people that they have vot been imposed upon, )
:k 4t 3. 3. # :: - *
Mr. TILSON. Earlier in the gentleman's remarks he said
Something like this : -
It is a very strange thing that the Army officers do not want it to
appear that they are ma Dufacturing things too cheaply in Government
arsenals, because they want to give as much as possible to private
Imanufacturers.
In connection with that statement the gentleman referred to
armament rings, arrnor rings, war traffickers, and so on, mak-
ing, in my minei, a very clear inmplication that these Army offi--
Cers were either corrupt, or at least did not have very high
ideals of their duty, in preferring to make the Government
pay dearly for its ammunition and armor purchased from
private parties rather than imanufacture them more cheaply in
Government plants. Does the gentleman Wish to create the
impression that that is true?
Mr. TAVENNER. That is...my intention, to create that im-
pression, that certain of our Army and Navy officials have
wasted the taxpayers' money as if it were water. I ask unani-
mous consent to have my time extended half an hour. I am
going to answer the gentleman and give specifie facts.
• The SPEAKER. The gentleman from Illinois asks unanimous
consent that his time be extended half an hour So that he ean
answer the question. *
Mr. TILSON. Reserving the right to object, Mr. Speaker
Hlaughter on the Democratid side), I wish the gentleman to
have time, provided he will yield for reasonable questioning.
Mr. TAWENNER. I will.
:: :: 3. 1. 1. 1. iſ:
Mr. TAVENNER. L. charge that the Chief of Ordnance, who
awards these contracts for the Army, has awarded contracts
running into millions of dollars annually, and he has paid
private manufacturers, and particularly the Bethlehem Steel
Co., from 20 to 60 per cent more than these supplies would
have cost if manufactured in Government plants. The man who
awards these contracts, Gen. Crozier, was formerly in partner-
ship with the Bethlehem Steel Co. He took out a patent on-
what is known as the Buſfington-Crozier disappearing gun
carriage, and he and another Army officer, who was, by the Way,
the preceding Chief of Ordnance of the Army, sold that patent
to the Bethlehern Steel Co. ſor $10,000; and he went into a
contract with the Bethlehem Steel Co. by which he was to receive
royalties on all of these disappearing gun carriages that should
be sold to foreign nations.
Why, gentlemen, the other day I saw where some American,
who was not even in the employ of the Government, was said to
have made a great invention, and he was reported as Saying,
“I will not sell my invention to any foreign country. The
result of my brains in making this invention Will be kept for
24036—14942
*
-o
* . 17
my own 'country.” [Applause..] But here was an Army officer,
who was educated at the expense of the American people, who
took his invention. which was perfected in Government work-
shops at the expense of the American people, going into a con-
tract with the Bethlehem Steel Co. under which he was to
receive $1,000 royalty on every gun of a certain bore, $1,500
royalty on every gun of a different bore, and $2,300 on every
gun of another bore that should be sold to foreign countries.
What would happen if the United States should become in-
volved in a war with one of the countries which might have
bought the invention upon which this American Army officer
received a, royalty ? That same Army officer night have been
leading a Cornpany, and his own ruen shot down by the guns
perfected at the expense of the American people, simply in order
that he might have a royalty on each gun. [Applause. } I want
an investigation, and I Want him to produce a copy of that
COntra ("t.
Mr. HENSI.EY. Is it not a fact that some of these munition
concerns have at their head or eInployed in Some capacity men
who have been e(lucated at Annapolis or West Point?
Mr. TAVENNEIR. Yes; and some are now on the pay roll of
the Government. If you want to get in touch with the Du Pont
Powder Co. go out to the telephone booth and Jail up the Du
Pent Powder Co., and the man who will answer that call will
be Gen. Humphrey, a man to-day on the pay roll of the United
States Government, receiving $6,000 a year, and yet serving the
Du Pont poweler trust. [Applause..] “Who’s Who " gives the
address of this Du Pont employee as “War Department, Wash-
^ington, I). C.” - • -
Mr. MI1,LER of Delaware. Will the gentleman yield 2
Mr. TAVENNER: I yield.
Mr. MILLER of Delaware. The gentleman from Illinois has
seen fit to attack Gen. Humphrey by manue. I only know him by
sight and have seen him but a few times at that. --
;S. Mr. TAVENNER. Is the gentleman from Delaware making a
speech or asking a question ?
"'. Mr. MILLEIR of Delaware. I simply want to ask a question.
Does the gentleman think that it is fair to criticize a man who
in the course of his service has been retired by law by reason of
his age and yet is in the position to make an additional Suim nec-
essary for his support? Does the gentleman think he ought to
criticize him? -
tº Mr. TAVENNER. " I not only think it is fair to criticize him
but I consider that it is my duty. When I see a man on the pay
roll of the Government serving those who have exploited and
betrayed the Government, I think it is my duty to point them out
and ask the American people to look at them. [Applause. )
$ 2k sk $: 2\t :k §: *
Mr. TAVRNNER. If you want to know more about the Du
Pont Powder Co. I will go a little further.
The IYu Ponts and the Government have been, in the habit of
exchanging secrets in the manufacture of powder. Government
chemists and Government officers are continually experimenting
to improve the quality of powder, and full information is fur-
nished the Du Ponts.
24036—14942
18
And the Du Ponts were at one time—they are not now—in
an agreement with a German firm—the United Rheinisch West-
phalian Gunpowder Mills—to keep it informed of all improve-
ments in the processes of powdler making.
Here is the actual Wor(ling of the Contract :
Tenth. That any and every improvement upon said processes or either
of then mol, ie by eit i.er of the pal ties hel Qto at any time hereafter
shall forth with “be imparted to the other of the parties hereto.
And even this is not all. The Du Ponts agreed to keep the
German concern informed at all times of all powder furnished
to the Unitel States Government, stating in detail its quality
and characteristics, and even the quantity, making themselves,
to all practical ends, paid informers of a foreign Government.
Here is the exact language:
Thirteenth. That the parties of the second part [the Du Ponts] will,
as soon as possible, inform the party of the first part [the German
concern ) of eat h and every contract for brown powder or nitrate of
ammonia powder received by the parties of the second part from the
Government of the United States or any other contracting party or
parties, stating in detail quantity, price, time of delivery, and all of
# ºutrements that the powder called for in such contract has to
As the German Government maintains a strict supervision
over German military manufacturing concerns, there can be
little doubt but that the German Government knew of every
pound of powder we purchased during the life of this agree-
ment, its exact quality, and exactly the extent of our reserve
Supply.
I quote the following from an article by Charles Johnson
Post, in Harper's Weekly for May 9, 1914: •
Do you recall the friction with Germany in 1898 over the German
naval squadron in Manila Bay ? A Gelman admiral brought on a situa-
tion that might have held momentous consequences. And Germany
knew to a pound what our powder reserves were and what their
qualities were.
The names attached . to the German contract were Eugene +
du Pont, Francis G. (lu Pont, H. A. du Pont, William du Pont,
trading as the E. I. Du Pont de Nemours Co. *
1. $: 1: 3% 4. º 10:
IT IS NOT A CRIME, BUT A FACT, THAT TITE MUNITIONS PATRIOTS FOUNDDD
THE NAVY LEAGUE.
Mr. TAVENNER. I am not charging, and have never as-
serted, that it is a crime of any kind for stockholders of War-
trafficking concerns to be the founders and principal backers of . . .
the Navy League. I am simply stating that it is a fact that"
they are: the officers of the Navy League have been insisting
that it was not the fact. * ~ *
I am not contending that the powder, armor, and munitions
firms have no right to encourage Uncle Sam to buy their wares.
I am morely insisting that they shall do it in their true capacity
as armor and munitions merchants and not by working alter-
nately on the fears and patriotism of the Annerican people,
making patriotism the means and private profit and private
graft the end. …”
I am not opposing the program of the Navy League because it
is advocating “preparedness,” but because of the kind of pre-
paredness it is advocating. The Navy League is advocating a
$500,000,000 bond issue for battleships, and So forth, but
it is not advocating that the taxpayers should receive a dol-
24036–14942
19
-
lar's worth of battleship for every dollar appropriated, or that
the amount of increased naval appropriations should be raised
by a tax on incomes or inheritances.
And it is not because the matter has not been Called to the
attention of the league. It is nearly two years now since I
addressed, on January 16, 1914, a letter to the secretary of the
League, in part, saying:
I beg to acknowledge receipt of your letter of the 13th instant,
together with inclosures as to why a powerful Navy is needed.
Assuming that you are in good faith in this agitation and really
desire the largest possible Navy for patriotic reasons, I am going to
take the liberty of suggesting to you that if you will inaugurate a move-
ment for the Government manufacture of all munitions of war, includ-
ing all battleships, your campaign will strike a much more responsive
chord with both Members of Congress and the people. ,
In other words, if the Government is to do all of the manufacturing
of munitions of war, including battleships, the point can not then be
successfully raised that the agitation is for the benefit of the armor
ring, the ammunition ring, and the Shipbuilding Trust. -
But, if you do not advocate, the Government manufacture, of all
munitions of war, including battleships, you can not successfully deny
that you are carrying on a propaganda which means millions and
millions of dollars of extortionate profits to the above-mentioned in-
terests.
No action, however, has been taken by the League. I believe
that if Congress should decide to manufacture all of its battle-
ships, submarines, armor, guns, and multitions and place the
burden of the cost of the Army and Navy upon incomes and
inheritances, where it should be placed, the Navy fleague would
forth with close the doors of its lobby in the National Capital and
its backers would be the loudest to protest against an annual
expenditure of $250,000,000 for war in time of peace.
Morgan and business associates of Morgan appear to have
always been in control of the Navy League, although there
have at all times been numbered among the officers, directors,
and honorary vice presidents men whose disinterested patriotism
is beyond question. And the members of the League as a whole
can at the very outset be absolved of any suspicion of taint,
as it is probable that for the most part they joined the organi-
zation in the belief its backers were prompted by considerations
wholly and purely patriotic and that the inspirations of its
founders were not in any sense directly or remotely associated
with the business of making and Selling armor and cannon.
ARMOR-PLATE MAKERS ARE THE MOST PATRIOTIC PATRIOTS ON EARTH.
There are but three firms in the CJnited States that manu-
facture armor plate—Midvale, Bethlehem, and Carnegie com-
panies—and each of them is represented in the list of 19 men
who, according to the official journal of the Navy League, were
the founders of the organization. -
At the time this particular list of 19 founders of the Navy
League was published there were some 80,000,000 or 90,000,000
Ordinary individuals and thousands of directors of corporations
in the United States.
Is it not a rather peculiar coincidence that among those 19
patriots who stepped forth from all the millions of American
citizens to save the Republic by advocating larger appropriations
for battleships, every armor-making concern in the United States
should be represented ? And that the greater half of the 19
patriots were connected with firms that would directly profit
from such propaganda? And that most of those who were not di-
rectly concerned with such firms were connected in Some manner
24036—14942 -
*
20
with individuals or firms that would profit? To expect the in-
telligent men and women of this country to agree with the Navy.
League Officials that this was not a peculiar coincidence is to
assume that the American people are fools.
Or can it be that we are mistaken, and that the explanation
of the presence of So many war traffickers among the founders
of the Navy League is that patriotism just “naturally runs to
armor-plate makers? If the personnel of the Navy League is a
thermometer registering the quantity and quality of the patriot-
ism of an individual, then it can not be successfully denied that
patriotism does run to the armor-plate makers. - - -
And standing shoulder to shoulder in patriotism with the
directors and stockholders of armor-plate-making concerns are
the directors and stockholders of steel, and then of nickel, and
Copper and zinc, and SO on down the line. As we proceed to
analyze the various groups of founders, life members, honorary
vice presidents, and contributors to the Navy League Govering
its entire existence of 13 years the conviction will be gradually
driven home to us that patriotism runs to metal, and that the
Navy League is the magnet which draws together the men who -
make money handling metal in some form or other and who
want to make more money. After these basic facts are clearly
established in our minds it will not appear strange, but quite
the logical thing, that our friend, Col. Robert M. Thompson, the
president of the New York Metal Exchange, should be the presi-
dent of the Navy League. --->
Col. Thompson might have been a founder of an Army
league, or a State militia league, or a national militia league,
but he was not. He is the chairman of the board of directors
of the Nickel Trust, and nickel is the most important and
most expensive metal that goes into armor plate, and armor
plate is one of the most important and most expensive thing
that go into a dreadnaught, and Col. Thompson became a founder
Of the Navy League. He has been one of the triost active heads
of the Navy League ever since. By a coincidence that is almost
weird, nickel, that valuable metal which is so indispensable in
war trafficking, has also always been well to the forefront in
the makeup of the Navy League of Great Britain. For many
years Sir Alfred Mond, chairman of the Mond Nickel Co. of
London, has been the vice-president of the British Navy League.
NAVY LEAGUE OF UNITED STATES COPIED FOREIGN NAVY LEAGUES.
The armor, munition, steel, copper, and nickel interests in this
country are proceeding to make new business in the same rrianner
that these interests have operated in other countries. The idea
of a “ navy league " did not originate in this country, but was
copied from Germany and Great Britain. In both countries the
moving spirits behind such organizations have been shown to be
the individuals who would profit from the increased appropria-
tions for navalism. .
There also are navy leagues in France, Italy, Belgium, Por-
tugal, and Spain. Those who manufacture guns, armor, and
battleships realize that there is no better way to agitäte for
increased armaments than by making use of the patriotism of the
masses. And the munitions patriots find that the most prac-
tical way to turn patriotism into private profits is to create
- the impression that a certain power is a menace. The more
definite and immediate the “menace" can be pictured the larger
and quicker the response and the greater the profitS,
24036—14942 - f - -
h *
21.
THE - “ROUND ROBIN ?’ OF TEIE, NAVY LEAGUES.
Strange to say, the various navy leagues have been on the
most friendly terms with one another and have cooperated,
eulogized, and encouraged each other in the most brotherly
fashion. This is decidedly armoresque.
The navy leagues of the various powers cooperate with one
another just as the armament interests (lo, and there is a reason.
They are the armament interests, with large memberships of
sincere, patriotic men and women and many of the most promi-
nent citizens roped in through false pretense. * -
It may be asket] how it is to the interest of the armament
Concerns of one country to See another dation enlarging its naval.
building program. It should be remembered that the leading
nations of the world fix their building programs in proportion to
the size of the programs of the other powers. If one power
increases the size of its fleet by two or three dreadnaughts the
Other powers feel that they must do the same. Thus it works
as an endless Chain, and there is no limit Save the ultimate
physical inability of the peoples of the earth to bear the burdens
Of taxation, which in this country are felt in the form of increase
in the cost of living.
Admiral Dewey, for instance, says that the fleet of the United
States should be larger than that of Great Britain by 1925.
But by 1925 the fleet of Great Britain may be twice its present
size. If it is a good policy for the United States to have a
larger fleet than that of Great Britain it is a good thing for
Great Britain to have a larger fleet than that of the United
States. And so on. - -
The armament interests of one nation, therefore, like nothing
better than to see a rival nation greatly increase its navy. Arld
the navy leagues, being in reality the armament interests, do not
look with disapproval upon the efforts of foreign navy leagues.
Iet us analyze this fraternal spirit which exists among
navy leagues—and which I endeavored to show existed so ex-
tensively between powder and armor manufacturers of the
World in my remarks published in the CONGRESSIONAL RECORD
on February 15, 1915—and see if we Qan make head or tail out
of it. One would think that if the Navy League of the United
States, was wholly sincere in its fear that this country, because
of its alleged inadequate Navy, is in real.(langer of destruction
at the hands of Germany or somes others foreign - power that
the last thing that the navy league officers would want to
* See would be a propaganda in Germany to greatly increase the
Inaval forces of that country. . . . . -
Yet the Navy League of the United States, s through its
official organ, the Navy League Journal, has enthusiastically
lauded the work and the spirit. and the results of the propa-
ganda carried on by the British Navy League, the Deutscher
Flooten-Verein (the Germans Navy League), Ligue Maritime
Française (the French Navy League), Lega Navale Italiana
(the Italian Navy League), Ligue Maritime Belge (the Belgian
Navy League), Iliga Naval Portugueza (the I’ortuguese Navy
Ileague), and Liga Maritima Española (the Spanish Navy
League). And I have no doubt there are Japanese and Chinese
navy leagues, too, i. I could but find some One to interpret the
contents of their newspapers and navy journals. As between
themselves the navy leagues are most brotherly and Christian-
like. - s f
24036—14942 --
22
*
The Navy League Journal for December, 1903, referred to the
work of the German Navy League in a spirit of profound admira--
tion, Concluding as follows: º -
Without exaggeration it may be asserted that to the German Navy
League, more than to every other influence besides, is due the fast and
wholesome growth of the German Navy. - -
The Navy League Journal might have added for the benefit
of the American war-trading gentry: - .
See what the German Navy League basi done in the way of making
business and profit for the German armor and munitions makers. Come
along, gentlemen, with your contributions to the Navy League of the
United States. It will bring the same results for you that the German.
Navy League brought for the German armor and munitions makers.
In the Navy League Journal of July, 1903, the first issue of
the league's official organ ever published, I find the following:
To-day Germany, thanks to enlightened statesmanship and the support
of the public, but most of all on account of the efforts of the Flotten-
Verein, or Navy League, whose astounding results we “shall strive to
emulate in this country, may be looked upon as the fourth sea power
in the World. - -
For 13 years the Navy League of the United States has been
pushing its “emulation ” of the parent navy league just as
fast as the sentiment in a democracy would permit, and it may
be said that the results now bid fair to be “astounding.” The
profits to the munitions patriots will in all probability be
equally “astounding.” - - - -
But is not this “round robin " of the navy leagues a most
impressive picture of phe failure of our boasted civilization to
really civilize? It has been said that “there is no politics in-
business,” and this “business” of the navy leagues of the
“civilized " world is the supreme exhibition of the truth of
this old saying that there is no principle in greedy trade.
Think for a .moment of these British, French, German, Italian,
and Spanish navy leagues thus clasping hands around the
world to stimúlate armies and navies so that they may be able
at the least provocation to destroy the tens of thousands of
innocent, thoughtless people who are actually believing in and
supporting these organizations as their protectors | • - -
Instead of encouraging and stimulating each other to work
for an annual increase of death-dealing machinery, and arma-
ment, why do they not adopt the reverse effort and suggest to
each nation an annual reduction of the armament which leads.
.
-
to that infamous business of war, by which millions are de- -
stroyed and ruined in order that a few thousands may wickedly
live on ill-gotten riches and power? - - ***
And the only answer the backers of the Navy League will
make to us, if they make it truthfully, will be: “It does not pay.”
From WALI, ‘striºt To reiſſ priſis IDENT’s CABINET AND 'BACK AGAIN. .
In tracing the business connections of the men behind the
Navy League one can not avoid being impressed by the number
of instances in recent years in which those identified with the
Steel and armor making Concerns find their way into the Official
life of the Navy Department, the Department of Justice, and .
*3
even the Department of State. …”
And the frequency with which ex-officials of these depart-
ments find their way into the employment of the steel and
armor plate makers is no less impressive. . -
There is, in fact, a well-beaten path between the armor and
steel makers and the executive departments enumerated, each
of which plays such an important part in molding the policies
24036—14942 . w • -. . . . . . . .
23
of the Government and in the long run the destiny of the
Republic. ~ - -
At least two recent Secretaries of State were affiliated with
Steel and armor plate concerns, either before or after their Serv-
ice in the Cabinet of the President of the United States. Their
portraits hang in the gorgeous reception room at the State De-
partment, and each is twice the size of that of Thomas Jefferson,
which occupies a less-conspicuous SpaceVinear by. *
It is not my purpose “to conulment either favorably or ad-
versely, but to present facts—facts which I consider important
enough to call to the attention of the American people; other-
Wise I would not present them. --- ---
One of the portraits to which I have reference is that of
Robert Bacon, who is now a director of the United States Steel
Corporation, which controls the armor-making Carnegie Steel
Co. Mr. Bacon is also a director of the Navy League. J. P.
Morgan is his fellow director on both the Navy League and
United States Steel. For 10 years previous to his appointment
as Assistant Secretary of State Mr. Bacon was a member of the
firm of J. P. Morgan & Co., 23 Wałł Street, New York. Mr.
Bacon was Assistant Secretary of State under Elihu Root, from
1905 to 1909, excepting for the period between January 27 and
March 6, 1909, when he was Secretary of State.
The second portrait to which I refer is that of Philander C.
. Knox, which hangs by that of Elihu Root.
In 1900, and for the 10 years previous, Mr. Knox was the
attorney for the Carnegie Steel Co., one of the three firms
comprising the armor ring in the United States. On April 9,
1901, Mr. Knox became Attorney General of the United States.
His appointment had been recommended to President Meſinley
by Andrew Carnegie. The United States Steel Corporation was
, -formed at almost the very date Mr. Knox became Attorney
General. No prosecution was ever started against the steel cor-
poration as long as Mr. Knox was Attorney General. It is
fair to say that the prosecution against the Steel Trust that
was started after he left the office of Attorney General was not
SuStained in the CourtS.
Mr. Knox was Attorney General from April 9, 1901, to June
30, 1904, was elected to the United States Senate in 1905, re-
Signing in 1909 to become Secretary of State.
Herbert L. Satterlee, a brother-in-law of J. P. Morgan, direc-
tor United States Steel, and general counsel for the Navy
League, was formerly an Assistant Secretary of the Navy.
Beekman Winthrop, director of the Navy League, left the posi-
tion of Assistant Secretary of the Navy and became a director of
the Lackawanna Steel Co. Lackawanna bas greatly profited from
the European war. The Wall Street Journal on August 24, 1915,
Stated that the Concern's earnings for the year should be around
$10,000,000. Large orders for rails from Russia and shrapnel
bars from France were reported to have been received. The stock
has advanced from 28 early in 1915 to 80 on January 3, 1916.
W. H. Brownson, retired rear admiral, now drawing $6,000 a
year from the Government, is a director of the International
Nickel Co. - *
Charles F. Humphrey, who receives $6,000 a year from the
Government as retired major general, is an employee of the
Du Pont Powder Co. E. G. Buckner, vice president of the Du
Pont, Co., testified before a committee of Congress that he em-
24036—14942 * J ~
~ 24
ployed Gen. Humphrey at Washington to “look after such little
details as getting information from all of the departments.”
WAR TRAFFICKERS FIND EMPLOYMENT OF NAVY OFFICERS A GOOD IN-
VESTM ENT. -
Whenever there has been an investigation by Congress of the
Navy Department—and there has not been one for a good many
years—the investigators incidentally turned up information
showing that Navy officers were secretly connected with the
armor-making Concerns.
The Senate Committee on Naval Affairs of the Fifty-fourth
Congress in 1897 was doing a little investigating into the reason-
ableness of the cost of armor and discovered that 8 or 10 thaval
officers were on the pay rolls of armor and steel companies and
at the same time on the pay roll of the Government.
These same hearings (pp. 155 and 353) brought Out the fact
that former Secretary of the Navy B. F. Tracy, after having
made a large contract as Secretary of the Navy with the Car-
negie Co., without advertisement or any attempt to obtain com-
petitive bidding, entered the employ of both the Carnegie Co. and
the Harvey Co. as counsel.
BIG EXODUS OF AIRMIY OFFICERS TO MUNITIONS PLANT'S SINCE OUTBREAK
OF EUROPEAN WAR.
* I do not pretend to know the number of ex Army and Navy
officers now connected with munitions manufacturers. There
are more of Such instances to-day, -ſ believe, than at any time
in the history of the Government. A very considerable amount
of the munitions that are going to the allies from the United
States is being made under the Supervision of ex-officers of
the American Army and Navy, who have resigned their official
positions to take employment at two, three, four, or more times
their former Salaries.
The naval bill which became a law June 10, 1896, prohibited
any naval officer on the active or retired list from taking em-
ployment with concerns having dealings with the Government.
T],e provision reads as follows: -*
And provided further, That hereafter no payment shall be made
from appropriations made by Congress to any oſſicor in the Navy or
Marine Corps. on the active or retired list, while such officer is em-
ployed, after June 30, 1897, by any person or company furnishing
naval supplies or war material to the Government; and such employ-
ment is bereby made unlawful after said date.
There is, however, no similar legislation with reference to
Army officers, the absence of which makes possible instances
like that of Gen. Humphrey, who is on the pay roll of both the
Du Pont Powder Co. and the Government.
On the subject of retired naval officers taking employment
with concerns having dealings with the Government, the Senate
Committee on Naval Aſſairs, following its discovery of a great
deal of this practice in 1896–97, had the following to say in its
report made to the Senate on February 11, 1897 (S. Rept.
1453, 54th Cong,, 2d sess.) : &
No man can well serve two masters, and if contractors having large
dealings with a department of the Government can take into their em-
ployment, with no limit is to colmpensation, officials of that department, .
and through them learn the secrets and the purposes of the depart-
ment, and, moreover insidiously influence its action, great injury may
result to the public service. The fundamental principle upon which all
legitimate business is transacted—that, each side shall be represented
solely by persons wholly devoted to its own interests—is viciously
violated by a custom which allows one side to take into its pecuniary
employment a representative of the other side.
24036—14942
$
x
25
An effort was made in the debate to draw a distinction between offi.
cers on the active list and officers on the retired list. The committee -
deny that any well-founded distinction exists which ought to influence
the decision of the question. Retired officers of the Navy remain officers
to all intents and purposes, with an important exception. Section 1462
of the Revised Statutes provides that “no officer on the retired list of
the Navy shall be employed on active duty except in time of war.”
But notwithstanding this statute exempts retired officers from aſl
obligation to render any service for the liberal retired pay which they
receive for life, amounting usually to three-fourths of their active duty
pay, yet they remain a part of the Navy of the United States, a vailable
in any emergency of war. They are entitled to wear their uniforms on
ublic occasions and are allowed free access to every bureau of the
avy Department, on the theory that they are still ready to serve the
interests of the Goverument by fidelity, sound advice, and an earnest
spirit of devotion to public duty. It is quite enough to allow such offi-
cers to enter into ordinary private employ IDent for compensation. To
permit their to take sides against the Government and to enter into the
employ of contractors having dealings with the Government reaching to
millions of dollars will certainly, if the custom continues, become most
pernicious and injurious to the public interests. Proclaim that such
officers unay, be so employed by repealing the clause which has now be-
**
--
come a law, and a boud and wealthy contractor, willing to spend enough
money to take in to his employ a sufficient number of oa va) officers on
the active and retired ſist, would be able thoroughly to weaken the
department in its deaſings with such cod tractor and to put the Govern-
ment at bis ºnercy in making bargains, which would be substantially
entered into with the representatives of , one side alone conducting all
the negotiations.
Personally I do not believe that either the War or Navy De-
partments should accept the resignations of officers who desire
to enter employment with concerns having dealings with the
Government. Army and Navy officers are but human, and if
they know that by winning the favor of private war trafficking
firms they may be taken into their employment at two, three,
or four times their present salaries they are not likely to he as
insistent upon holding out for all that the public is entitled to
as they would otherwise be. In a few words, this policy places
a premium, upon serving the interest of the war trading firms
instead of serving the interest of their employers, the American
taxpayers, who have paid for their special training and are
entitled to the full benefit thereof.
Furthermore, the basis of the policy of accepting resigna-
tions under the conditions noted is the assumption that the
Government is going to continue to give the maximum amount
of contracts for war materials to private plants and manufac-
ture the minimum amount in Government arsenals, navy yards,
and shipbuilding plants. -
I believe this assumption is entirely erroneous. I realize full
well, however, that the great majority of the Army and Navy
officials view the proposition of complete Government manufac-
ture of war materials with derision and Contempt and that this
view is fully shared by those Army and Navy journals that rely
upon the advertising of the great war trafficking firms for their
principal revenue. But unless I mistake the temper of the
American people, the (lays of the war traffickers are numbered.
Government manufacture of war munitions is coming—Com-
ing with a seven-league-boots stride, and gaining impetus every
hour. This linovelinent was slow in starting, but it will ulti-
mately bowl Over all the obstructions and obstructionists that
are in its path. The masses are long suffering. Already they
have suffered too long, and their temper now will not permit of
long (lelay. Unless this Nation should be plunged in War and
attention diverted, the policy of Government manufacture is
not far away, So let us retain our Army and Navy Officers who
24036—14942 ~.
• 26 - wº
have been specially trained in the manufacture of munitions of
War to take charge of Government plants.
GOVERNMENT BY WAR TRAFFICKERs FOR WAR TRAFFICKERS.
I believe that as long as the American people permit private
profit and private graft to remain in the war-trafficking industry
there is bound to be more or less government by the war traders.
No matter how vigilant the people may be, and the people as a
mass are not at all vigilant in matters of this kind, the war'
traders will manage to get their friends into those offices which
come into direct or indirect contact with the war-trading busi-
ness. There is no practical way of knowing whether an official -
does or does not own stock in war-trafficking firms. He may hold
Stock in the name Of a relative Or a friend.
Where there are huge private profits on one side and only prin-
ciple on the other, as in this case, private profits will, in most
cases, take the precedence. If the people wish to insure them-
Selves against all form of government by armor plate, cannon,
and munitions makers, there is but, one way they can do it, and
that is by talcing private profit out of war and preparation for
war by having the Government mail/ufacture its own materials
for the Army and Navy.
The profits of the munitions trade are greatest in war, and
therefore it is to their interest to have nations at War. The
more war, the more profits.
Behind the war trust is the most powerful, group of men in-
the United States, if not in the world. Its control is in the
hands of the same group of money kings that rule the insur-
ance Companies, the great banks, express Companies, telegraph
Companies, railroads, and Steamship lines. To realize the Colos-
sal power of the capitalists behind the steel, armor, ammunition,
and shipbuilding companies and recall the -desperate ends to
which more than one investigation has revealed they will go to
Satisfy their sordid greed for gold, and then to contemplate that
the United States in war means more in dollars to this group
than the United States in peace, is enough to justify the most
optimistic man to tremble for the peace of this patriotic and -
Christian people.
And if war should come, what a monstrous proposition it
would be which would require one group of citizens to go to
war and sacrifice their lives for the State while another and
Smaller group—the war traſſickers principally responsible for
the war—remained at home becoming immensely rich.
Nationalization of the manufacture of munitions would un-
doubtedly have prevented the present strained relations with
Germany. The cause of the strained relations is that Germany
is sinking ships. Germany has been sinking ships principally
to prevent American-made annmunition from reaching her ene-
Imies. Thus, in order that a Comparatively few may make
private proſit, the peace of 100,000,000 is placed in jeopardy. *
It is to the interest of only the few to leave profit in War
and preparation for war, while it is to the interest of the entire
earth's population to take it out. -
STEEL.
The following are the steel companies which have representa-
tion in the Navy I_eague:
1. United States Steel Corporation. represented through J. P.
Morgan, director of Navy League and United States Steel; Robert
24036—14942
27 -
Bacon, director of Navy League and United States Steel; Elbert
H. Gary, contributor to Navy League and chairman of the board
of directors and chairman finance committee United States
Steel; Henry C. Frick, honorary vice president Navy League
and director United States Steel; George F. Baker, jr., con-
tributor to Navy League and son of director of United States
Steel. The late J. P. Morgan was a founder, contributor, and
director of the Navy League and the organizer and a director of
{Jnited States Steel. Charles M. Schwab, who is shown in
Moody's Manual for 1903 as then president of United States
Steel, is shown by the official journal of the Navy League for
1903 to have been one of the founders of the league in July of
the Same year. - -
2. Bethlehem Steel Corporation, represented through Charles
M. Schwab, one of the founders of the Navy League and presi-
dent of Bethlehem, which controls the San Francisco Dry Dock
Co., the Union Iron Works Dry Dock Co. of San Francisco, the
Fore River Shipbuilding Co., Harlan & Hollingsworth Corpora-
tion, and the Titusville Forge Co. Bethlehem is also represented
in the Navy League through Allan A. Ryan, contributor to the
Navy League and director of Bethlehem; George R. Sheldon,
honorary vice president of the Navy League and director of
Bethlehem ; Charles F. Brooker, a former honorary vice president
Of the Navy League and Stockholder of Bethlehem. The above
held stock in Bethlehem on September 27, 1915, as follows:
Charles M. Schwab, 38,451 Shares ; Allan A. Ryan & Co., 13,910.
Charles F. Brooker held 474 shares on April 10, 1915. Itobert H.
Sayre, a former general manager of Bethlehem, was a life unem-
ber of the Navy League, and Lieut. J. F. Meigs, resigned, an em-
ployee of Bethlehem, was a life member.
3. Carnegie Steel Co., represented through those connected with
the United States Steel Corporation, of which it is an underlying
company, and was also represented before its connection with
{Inited States Steel through ex-Secretary of the Navy Benjamin
F. Tracy, attorney for the Carnegie Co. and one of the founders
of the Navy League, and indirectly through Albert B. Poardman
and James R. Soley, who were associated with Mr. Tracy.
4. Harvey Steel Co., represented through S. S. Palmer, one
of the founders of the Navy League, and president of the Harvey
Co., and 'through ex-Secretary Tracy, who was also the attorney
for Harvey Co. The Harvey Co. was therefore also indirectly
represented through Mr. Boardman and Mr. Soley.
5. Lackawanna Steel Co., represented through Beekman Win-
throp, director of Lackawanna and director of the Navy League,
and through Ogden L. Mills, contributor to the Navy League and
director of Lackawanna. James Speyer, life member of Navy
League, was until recently a director of Lackawanna.
6. Cambria Steel Co., represented until recently by E. T.
Stotesbury, of the firm of J. P. Morgan & Co. Mr. Stotesbury
was a director of Cambria and honorary vice president of the
Navy League. -
7. Midvale Steel Co., one of the founders of the Navy League.
8. Eastern Steel Co., represented through Harry Payne Whit-
ney, one of the founders of the Navy League and director of
Eastern Steel.
9. Pennsylvania Steel Co., represented through E. T. Stotes-
bury, member of firm of J. P. Morgan & Co., honorary vice presi-
dent of the Navy League, and director of Pennsylvania Steel.
24036—14942
;” &
º:
t
28
; 10. Pacific Hardware & Steel Co., represented through D. H.
*-*
IRane, life member of Navy League and formerly director Pacific
Hardware & Steel Co. - -
11. Federal Steel Co., represented through E. H. Gary, con-
tributor to Navy League and president and director of Federal
Steel. - --
12. Illinois Steel Co., represented through E. H. Gary, con-
tributor to Navy League and director of Illinois Steel. . . *
13. Minnesota Steel Co., represented through E. H. Gary, con-
tributor to Navy League and director of Minnesota Steel. .*
14. Union Steel Co., represented through E. H. Gary, con-
tributor to Navy League and director of Union Steel. º
15. American Steel & Wire Co., New Jersey, underlying prop- :
erty of United States Steel Corporation. (See United States .
Steel.) - - -
27 -- COPPER, - * -
Robert M. Thompson, founder, honorary vice president
1903–1909, director 1904–1914, chairman executive committee
1913–14, president Navy League 1915: President Orford Cop- .
per Co. - . - * º
Andrew Fletcher, jr., member W. & A. Fletcher Co., life
members Navy League: Director Union Copper Co. - -
Rodolphe Agassiz, honorary vice president Navy League 1915:
Director La Salle Copper Co.; director Superior Copper Co.;
director Centennial Copper Mining Co.; president and director
Isle Royale Copper Co.; vice president and director White Pine
Copper Co. ~ * -
William A. Clark, director Navy League 1914–15: President
and director United Verde Copper Co. --
Cleveland H. Dodge, life member Navy League: Director
Copper Queen Consolidated Mining Co.; vice president and di-
rector Detroit Cooper Mining Co.; director Moctezuma Copper
Co.; vice president Phelps, Dodge & Co. - -
J. H. Harding, contributor to Navy League: Director Amalga-
mated Copper Co. - -
A. C. James, life member Navy League: Vice president and .
director Burro Mountain Copper Co.; vice president and director
Copper Queen Consolidated Mining Co.; vice president and di-
rector Moctezuma Copper Co.; director Detroit Copper Mining
Co. of Arizona. - .
E. Meyer, jr., contributor to Navy League: Director Braden .
Copper Mines Co.; director Inspiration Consolidated Copper .
Co.; director Utah Copper Co. - -
ZINC, LEAD, AND BRASS.
E. T. Stotesbury, honorary vice president Navy League 1915:
Director Riverside Metal Co.
W. J. Matheson, contributor to Navy League: President and
director Matheson Lead Co. r
A. C. James, life member : Director American Brass Co.
Charles F. Brooker, honorary wice president 1909: President
and director American Brass Co. -
Rodolphe Agassiz, honorary vice president 1915: Director
Dnited Zinc & Chemical Co. - -
S. S. Palmer, founder: President and director Empire Zinc Co.;
treasurer and director Mineral Point Zinc Co.; president and,
director New Jersey Zinc Co. 2
H. W. Hayden, contributing member: President and director
Manhattan Brass Co. * - a “. . .
24036—14942 • * : - ,
&
29
Myron T. Herrick, honorary vice president 1903–1909, 1915:
Director United Zinc & Chemical Co. -
Cleveland H. Dodge, life member of Navy. League: Director
American Brass Co. --
* NICKE.L.
Seward Prosser, contributor to, Navy League: Director Inter-
national Nickel Co. - - ,
• ' Robert M. Thompson, president Navy League 1915, founder,
honorary vice president 1903–1909, director 1904–1914 : Chair-
man board International, Nickel Co. -
THE NINETEEN IFOUNDERS.
& *
I have already called attention to the fact that on page 32 of
the February, 1904, issue of the Navy League Journal, the
“Official Orgah of the Navy League,” 19 names are published
as being those Of the “founders ” Of the league. The names there
listed are as follows:
Herbert L. Satterlee. George Westinghouse.
J. W. Miller. R. S. Sloan.
J. Pierpont Morgan. John J. Astor.
Benjamin F. Tracy. R. M. Thompson.
Seth Low. Charles M. Schwab.
Clement A. Griscom. John J. McCook,
Thomas Lowry. , & Harry Payne Whitney.
Timothy L. Woodruff. George B. Satterlee.
Midvale Steel CO. y S. S. Palmer. -
Anson Phelps Stokes. -
ARMOR BLOWHOLE FRAUDS PERPETRATED ON THE GOVERNMENT BY TEI.E;
- - CARNEGIE Co.
Becoming a founder of the Navy League is not the only way
in which Charles M. Schwab has demonstrated the quality of his
“patriotism.” His devotion to his Government is described at
considerable length in a certain musty Government document
Stored away in the archives of Congress. It is styled “Violation
of Armor Plate Contracts,” and is known as House of Repre-
sentatives Report No. 1468, Fifty-third Congress, second session.
The report followed an investigation in 1894 by the House
Committee on Naval Affairs of charges against the Carnegie
Steel Co., then Carnegie, Phipps & Co. The evidence of fraud
upon the Government by the Carnegie company was large and
convincing, The testimony showed that armor plates containing
“blowholes " were palmed off on the Government and later
used on battleships of the American Navy; that these cavities
were secretly “plugged ” and kept “concealed ” from the Gov-
ernment in SpectOTS. - c - --
Mr. Schwab, one of the founders of the Navy League, was
general superintendent of the Carnegie company when this
fraudulent work was done. When questioned concerning the
plugging of blowholes, Mr. Schwab said (p. 647) :
Q. Do you know whether the company did really conceal the fact of
blowholes in the plate 2—A. I think likely that was done.
Asked if he gave orders that the defects in the plates be con-
cealed from the Government inspectors, Mr. Schwab replied that
he did not give orders that the defects be concealed, but added:
I certainly gave orders that blowholes should not reject the plate.
Again (p. 649), Mr. Schwab testified :
Q. Do you know of any case where they were plugged and filled with-
out the knowledge of the Government inspector 2—A. I do not, but I
believe it was done. , “
24036—14942
30
William E. Corey, now president of the Midvale Steel, &
Ordnance Co. and a director of Col. Thompson’s International
Nickel Co., was shown to be in charge of the armor plant in
Which the frauds Were COImlmitted.
When Superintendent Corey was testifying he was asked (p.
--
Q. Did anybody above you—did any superior officer—know that you
were doing this thing 2—A. Yes, sir.
Q. Who was it?—A. Mr. Schwab knew about it in a general way.
Q. Did anybody else?—A. No, sir. -
In making its report of the investigation the House Committee
On Naval Affairs Stated that “the fraud has been traced home
to their general Superintendent, himself a stockholder in the
Company.” x-
The “general superintendent’’ was Charles M. Schwab.
The report then proceeded, as follows, to take the measure of
the patriotism of those responsible for the fraud:
- CRIMINALITY OF THE CARNEGIE COMPANY.
If the criminality of a wrongful act is to be measured by the deliber-
ation with which it is committed, the magnitude of the evils likely to
result from its perpetration, and the want of provocation with which
it is done, the frauds which your committee have found are worthy to
be call 1 crimes. The servants of the Carnegio Steel Co. (whether
with or without the knowledge of the company), to increase their gains,
deliberately continued for many months to commit acts whose natural
and probable consequence would be the sacrifice of the lives of our
seamon in time of war, and with them, perhaps, the dearest interests
of the Nation.
The company were hired to make the best possible armor plate and
paid an enormous price for so doing. They were hired to make an
armor that would stantl the shots of an enemy and upon which the
Nation might rely in time of need. They were paid between $500 and
$700 a ton and thousands of dollars a plate for so, doing. Resting
under these obligations the company or its servants have perpetrated
manifold frauds, the natural tendency of which was to palm off upon the
Government an inferior armor, whose inferiority might perchance appear
only in the shock of battle and with incalculable damage to the country.
No fine or mere money compensation is an adequate atonement for
such wrongs. The commission of such frauds is a moral crime of the
gravest character. Your committee do not consider it as within their
province to draft a criminal statute : , but they do feel under obligation
to call the attention of the IIouse to the importance of protecting in the
future the interests of the Treasury, the lives of our seamen, and the
safety of the Nation by appropriate legislation, denouncing as “rimes
all stich acts of fraud and deception practiced upon the Government in
connection with armor plate and other material of war, and making
such acts severally punishable in all persons who commit them or aid
and abet their commission.
Philander C. Knox, general counsel for the Carnegie Steel Co.,
who later became Attorney General of the United States, and
Iater Secretary of State, vigorously protested to President Cleve-
Iand against the assessment of any (lamages. Secretary of the
Navy Herbert reported to Congress that “it was strenuously
and ingenuously argued by the counsel for the Carnegie CO.”
that no right to exact penalties existed. *
President Cleveland assessed damages of $140,000 against the
Carnegie Co., which were immediately paid. The fact that the
Carnegie Co. (lefrauded the Government did not appear to im-
pair in the least its standing with the Navy Department.
The Carnegie Co. was absorbed by the United States Steel
Corporation, and Mr. Schwab became president of this corpora-
tion. Then he went over to the Bethlehem Steel Corporation,
and since he has been president of the latter Concern it has been
charged by workmen in the Bethlehem plant that frauds were
being perpetrated upon the Government, just as they were when
Mr. Schwab was general Superintendent of the Carnegie Co.
24036—14942
31
‘. CLEMENT As GRISCOM.
So far I have mentioned the business connections of but 3
Of the 19 founders. Of the others, Several Of whom are now
deceased, I will merely call attention to their business connec-
tions at the time of their affiliation with the Navy League.
Clement A. Griscom was a fellow director with J. P. Morgan
of the United States Steel Corporation, which controlled the
armor-making Carnegie Steel Co. He was also a director of
the Wrm. Cramp Ship & Engine Building Co. and the Electric
Boat Co., both of which are war traders. Arº
HERBERT L. SATTERLEE, PATRIOT NO. 5. !” -
Herbert L. Satterlee is a brother-in-law of J. P. Morgan. ,
r COL. ROBERT M. THOMPson. -
Col. Thompson is chairman of the board of directors of the
International Nicker" Co, and president of the New York Metal
Exchange, as previously stated.
* HARRY PAYNE, whitNEY.
Harry Payne Whitney, at the time he became one of the 19
foundlers of the Navy League, was a fellow director of the late
J. P. Morgan on the National Bank of Commerce, on the Clear-
water & Racquette Lake Railroad, on the Fulton Chain Railway,
On the Fulton Navigation Co., on the Racquette Lake Railroad
Co., and the Newport Trust Co. --
- BEN J AM1 IN F. TRACY.
Benjamin F. Tracy, another of the 19 founders, was Secretary
of the Navy from 1889 to 1893. As Secretary of the Navy Mr.
Tracy made contracts with the Carnegie Co. and the Harvey
Steel Co., and after his term expired became the attorney for
both concerns. Mr. Tracy was a director of the Cornucopia
Mines of Oregon and the Tennessee Coal, Iron & Railroad Co.
Died in 1915.
- t
S. S. PALMER. . .
S. S. Palmer, 55 Wall Street, New York, another of the 19
founders of the Navy League, was interested in many concerns
which would profit from “preparedness.” He was president
and director of the Harvey Steel Co., a recipient of royalties
from all armor plate manufactured here and abroad; president
and director of the Empire Zinc Co., Mineral Point Zinc Co.,
New Jersey Zinc Co., Empire Zinc Co. of Colorado, New Jersey
Zinc Co. of Pennsylvania, and a director of the Lackawanna
Steel Co., which has received enormous orders from the allies,
and the Empire Zinc Co. of Missouri. *-*. -
JOHN J. A. COB ASTOR. \
John Jacob Astor was a fellow director of J. P. Morgan on the
Western Union Telegraph Co. at the time he became one of the
founders of the Navy League. * >, |
GEORGI, whistINGHouse."
George Westinghouse, another of the founders of the Navy
Teague, was president of 30 Corporations with an aggregate
capital of $120,000,000. -
The Westinghouse corporations have profited enormously
from War orders. Financial America On August 2, 1915, Said :
Actual orders on the books of the Westinghouse Electric & Manufac-
turing Co. now total between $65,000,000 and $70,000,000, and the
company also has §§§ on sufficient additional orders to bring the
amount up to Over $100,000,000,
24036—14942
32
JAcOB W. MILLER.
$
Jacob W. Miller, another of the 19 Navy League founders,
was at that time the general manager of the Marion district
of the New York, New Haven & Hartford Railroad Co., on the
-
board of (lirectors of which sat J. P. Morgan. Mr. Miller is .
also president of the Costa Rica Development Co., of which
Col. Thompson, president of the Navy League, is a director.
- - ROISERT S. SLO AN.
Robert S. Sloan is a trustee of the American Surety Co., 100
Broadway, New York, and lias as One of his fellow trustees
William Nelson Cromwell, who is also a director of Col. Thomp-
son's International Nickel Co. Mr. Sloan is also president and
director of the IFitzgibbons Boiler Co., of Oswego, N. Y. -
ANSON PHIELI'S STOIKES. -
Anson Phelps Stokes was a partner in the firm of Phelps,
Dodge & Co., merchants with large copper mining interests.
This firm is now One of the largest Copper mining Concerns in .
the United States and is well represented on the Navy League.
WHY NOT I’EIR:MI IT THE PUI:f I C TO IxNOW THE IDENTITY OF THE PATHIOTS
PEH IND THE WAR TRUST 2
When the naval bill was before the House last years ºf offered
the following amendment:
Pro pidcd, That the Secretary of the Navy shall not consider any bid
for the supplying of the armlor or armament herein provided, for unless
such bid is accompanied by a sworn list of stockholders and bondholders
of the corporation submitting such bid, such list of stockholders and
bondholders to be taken from the books of said Corporation as of date :
of July 1, 1914 : And it is further provided, That such list of stock-
holders and bondholders shall be transmitted to Congress in a separate
I'eport by the Secretary of the Navy.
This almendment went to its grave on a point of Order made
by the chairman of the Naval Affairs Committee.
My purpose in offering the almendment was to ascertain the
names of the sharellolders of the war trust, the names of the
men who profit from the manufacture of war munitions by pri-
vate construction. Those who are advocating the taking of
profit out of war and preparation for war by having all Army
and Navy equipment manufactured in Government plants can
make a more intelligent fight if they know exactly who they are
fighting. Until the identity of the stockholders of the war
trust can be established it might, perhaps, even though un-
pleasant, be logical to assume that those patriots who cry out
in anguish every time the Governinent manufacture of war mu-
nitions is mentioned have been struck in the region of the
pocketbook, an exceedingly tender part of the anatomy.
Comparisons are odious, but in 1909 the Investors’ Review
Of Ilondon examined the Stockholders' lists of several Pritish
war-traſticking concerns and it found in the list of one company
alone (Armstrong, Whitworth) the names of :
Sixty noblemen, their Wives, Sons, or daughters.
Rifteen baronetS.
Twenty knights. • , , a * * *
ICight members of Parliament.
Twenty military and navy officers.
Eight journalists. -
Later lists revealed a marked connection between stock hold-
ing in armor and munition companies and active membership
of “purely patriotic ’’ organizations, such as the British Navy
I Cague.
24036—14942
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