Charles T. Fowler, “Corporations” (1886)



Build your railroads; they are ours by a law ye know not of!

Mr. Barnes inquired as to the general effect of the pooling system and Gould replied it was beneficial to the public, because without it, most if not all the railroads in the country would be in the hands of receivers.

Mr. Barnes:—“If pooling is beneficial to the railroads, may it not be to the public?”

Mr. Gould:—“I think it is.” Congressional Investigation of The Strike.

THE subject of corporations furnishes a field for the further application of the principles of co-operation. Since some corporators claim that they are co-operative, and some co-operators ask to be incorporated, it is necessary to understand the difference.


A corporation is an association of individuals, acting as one body by force of law. Co-operation is an association of individuals acting together in their separate capacities by private contract. Corporation is a legal word, co-operation is a natural one. The members of one are legal, artificial, constructive persons, those of the other are natural ones; one acts under a charter, the other acts under an article of agreement or association.

The Real Essence, then, of every corporation, wherein it is a corporation, is its stolen status, or change in the natural status of the individuals composing it, whereby natural persons are changed into legal, artificial ones, with powers and privileges legislated into them that do not belong to ordinary mortals. The first great incorporator was a supernatural God, the second was the bishop and the king, the third and last is the priest and the politician. The source of authority in co-operation is inherent in the nature of things, beginning with the inevitable status of individuals as factors in peaceable society. The source of authority of the other is handed down from the legislature, just as the ordaining of a clergyman is supposed to confer added powers.*

A corporation, being bound by its charter to act as one body, is necessarily coercive. Majority rule and compulsory taxation are its working methods. Co-operators are not governed by numbers, but by a principle of reciprocity. Whenever it is for their interest to act as one body they can do so. Being internally bound is found to be most effective. Co-operation contains all the strength there is in each individual composing it.

Why, then, does the corporation employ coercion? If it never expected to change its mind, it would not need it. If it ever did expect to change, coercion would be a dangerous source of weakness and disorder This is the reason, because a corporation is a clique engaged in making a profit off the public. Whether it be the monopoly of land, or money, natural resources, or the people’s social franchises, its mission is predatory. Conferring special privileges upon some, is to deprive others of their natural rights. If some can get a living by act of Congress easier than by earning it, others will have to steal and starve. Privilege goes with plunder, injustice with coercion, tyrants with slaves. The corporation seeks privilege in order to plunder, and has the plunder because of the privilege. In this it is coercively agreed.

Co-operation, instead of seeking special privileges, eliminates, profit. Its private interests are perfectly identical with universal interests. This results in the cost system which, when it comes round in a circle, is far more profitable than profit. It not only affords a competence but guarantees security, neither of which is sure of being obtained under profit. When the profit-making system gets round to where it began it is very costly, its waste and antagonism probably amounting to more than the total consumption under cost.

Just think of the corporate privileges afforded to capital applied to labor. Suppose a body of tramps should hold a caucus by the wayside and voting themselves into a body corporate to break into houses; and suppose, upon seeing their approach, the occupants thereof should cry out, “Stop thief!” might not this corporate body reply, “Our franchises are well defined?” And, when brought before a magistrate, might not they plead acquittal on the ground that their “liabilities” were “limited “ to the “original amount of stock” invested? Upon being pressed for a more satisfactory defense, suppose they should offer to put their stolen goods into the hands of a “receiver.” Then imagine this receiver taking leg-bail, and when caught, availing himself of the “bankrupt law.” Or, having “retired” in affluence, he builds a church, dedicating it with a eulogy to “overproduction,” claiming it was under such circumstances the stealing was done, on the principle that ye should help bear “one another’s burdens.” Thus it might be shown that house-breaking was but “one form of co-operation!”

But we have not found that the liabilities of the workhouse inmate were at all limited, even in that “irregular,” defalcation of “misappropriating” a loaf of bread. Indeed, his liabilities seem quite unlimited. Neither have we seen a bank or railroad robber get off according to the original amount of stock invested, or if caught, could turn it over to a receiver, or the bankrupt law, much less have his lease extended ninety nine years, with a grand dowry from the general government, and a supreme court decision that the original terms of incorporation was a contract that could not be annulled!

There is no corporate body in existence to day that cannot be controlled by its management so as to cause it to fail, or be sold out, or transferred, or bonded and wrecked, or wound up, or so altered in conduct, as to freeze out the real parties in interest. The manipulations of these artificial, legal creations are unequalled by the most advanced materializing mediums. Beginning by stealing from the public, they end by stealing from themselves. Starting as a ring, it seeks a centre, forming a ring within a ring, until those on the inside exchange their experience for the money of those on the outside,—so dearly does Nature love individuality!


* Marriage, partnerships, notaries, are a modified form of corporation.


Seeing the inroads that corporate monopoly is making upon labor, and the consequent accumulations thereby, how natural that it should try to imitate it? Incorporation is now the fashion. Everything is incorporated but the Chinese laundries and the boot-blacks. In New York, there is a gas consumers corporation: if there is one thing above another, that the projector of the “Credit Foncier” is certain of, it is that labor must be incorporated.* Because capital has abolished the right of contract, therefore the Knights of Labor think they can wade in after it. The error of these people lies in mistaking the cause for the remedy. The remedy is not a repetition, but in the reversal of the corporation’s tactics. If liberty leads to equity, the methods of liberty are essential to equitable ends. Economic co-operation is reached by governmental co-operation. Advantage and privilege and arbitrary power are perfectly compatible with a thief’s mission, but cannot aid honest labor. Because a gang of thieves get rich breaking into our houses, it does not follow that we can recover by forming another gang. That might do for a partial and temporary advantage, but in the end it would only aggravate the situation. But if, being defensive against usury, dependent upon privilege, is what is demanded, then in co-operation will be found that source of strength. For what is it that every co-operator is bound to recognize? Universal competition, as the safe condition of universal co-operation.


* “Integral Co-operation,” by A. K. Owen, Published by J. W. Lovell M &. 16 Vessey St., N. Y. Price 30 cents. For the “Credit Foncier of Sinaloa,” send to E. & M. Howland, Hammonton, N. J. Price, $1. per year.


But the last, and most subtle phase of the corporation is the paternal; all the more insidious is it because so refined,—”Paternalism made perfect,” it is called. Connected with its grasp of authority there may be a veritable extension of liberty, —perfect reciprocity being very jealous of its jurisdiction,— but its source of authority is the emotion of some central soul, not the natural law of a reciprocal relationship. Its measures are for the “public good;” it means to enforce what is good, true, and right; it aims to set a “good example;” its motto is “love and duty.” Be not deceived by the altruism that denies fundamental rights, and supplants justice with love. The law must direct the power, the head lead the heart, as the engineer directs the steam. The Buddhists have always recognized this form of spirituality, and been free from persecution, but Christianity has persecuted in the very same breath with “love,” because it is ignorant of any law of human relationship. Duty, or loyalty, is an obligation one subjectively feels; liberty furnishes its corrective, and field for proper exercise.

Paternalism declares that cattle, dogs, rats and mice believe in equal liberty, as they understand it, but that does not make it any the less “license.” Thus, these paternal cats and sacred oxen consider that it is their mission to rule over us; that they are exempt from the category of cause and effect, the influence of circumstances, or an equal relationship before the Light. Therefore, as one of the “unwashed,” it becomes my bounden “duty” to rebel, lest their love becomes hate, and the first glow of their zeal be turned into an infernal machine to bind me as their slave. Instead of equal liberty then, being license, as the paternalists would suppose, it brands paternalism as a crime! No intelligent man will accept arbitrary power, and no upright one can long retain it without becoming corrupt. The fact that it exists is ample evidence that it is being used for selfish ends. No person, not demoralized, will permit the smallest encroachment upon his liberty, for it is little by little that the greatest tyranny thrives. The possessors of arbitrary power never let go of it freely, but condemn, as opposed to law and order, everything that they dislike, especially a free press. Never is liberty so blindly violated as when, in the name of the “public good,” the line between the individual and society is utterly confused. But where the status of the individual is definitely determined, the most possible has been done to preserve the good intent of paternalism. For, without liberty, there can be no progress, without choice, no character. When force is exerted to suppress evil and error, then virtue is dead; but where there is the freest competition between good and evil, truth and error, the good and the true will prevail. Equal liberty is not a hot-house plant. If it be wild, it grows natural; its badness is better than paternal goodness; neither will it brook its patronizing airs.

Nothing, however, is here intended against leadership, only drivership. Every organization needs the individuality of an executive head. A swarm of bees, and a flock of geese have this, but they do not impose bee-morals and geese-morals on their communities.


Some people make a distinction between public and private corporations. To be sure the work of some is more or less public than that of others, but by virtue of the incorporating principle, the change of individual status, we must decide that such a change is subject only to private interpretation, and that, therefore, there is no such thing as a public corporation. Limit and guard it as we may, so long as it is a corporation, it is a dangerous thing for co-operators to tamper with. If arbitrary authority be planted, as a seed, in the organism, it may be watered with the best intentions, but when the first glow of zeal has departed, it will spring up and dictate the tree and fruit. How little did our Fathers dream that they were planting what we see to-day.


How, then, did it happen that the “private corporation,” so called, first got into power? Because it was supposed to be for the “public interest.” How could any grant of arbitrary power ever be construed as for the public interest? Because it was assumed, without question, that a governmental corporation was a public corporation, and things that were considered not exactly within the province of government yet too great for individuals to perform, were given to these special, chartered, creations of power.

Now, if changing a man’s natural status so that he can steal, is for private ends, what must be said of the power that makes a business of doing it? Is it public or private? It differs from other corporations only in being their father, in being older and bigger, the original and boss corporation. If there is to be one great corporation, then let us have a thousand small ones, in order to get some comparison and competition. What is the last analysis of a governmental corporation, is it co-operative’? Its pap is compulsory taxation, its expression is through majority rule; take these away, and its life would be gone. What is compulsory taxation but highway robbery? What is majority rule but assault and battery? both of which are crimes. I do not mean isolated, personal, or individual crime, that would be too hopeful to assume, but permanent, chronic, organic crime. Not any one act, such as Victor Hugo described as being a crime, but I mean that the State itself, in its corporate life, is a great organized crime. Its arbitrary power is necessarily private, though its magnitude blind the stupid and bewilder the simple. Its emolument may be strained through some party shibboleth before it reaches the individual yet it gets there the same. They talk about the “venal ballot,” as if every ballot was not a venal ballot! For, if the defrauded should get back what majority-rule ballots are worth to vested interests, one account would exactly balance the other, and all balloting cease.


Some reformers, seeing the need of national association, confound it with a governmental corporation. National co-operation begins with the individual and blossoms into international proportions. A governmental corporation begins with a central head and imposes upon the individual. A government by, for, and of the people, everyone, would be no government, for it would then have lost its centralized head, and changed its source of authority. To speak then of the present form of government as ever becoming co-operative, is a delusion, a misnomer, a contradiction. Co-operation begins where the government leaves off.

“But the railroads and telegraphs should be conducted the same as the post-office,” they say. Well, we have no objection to any individuals connected with the government conducting a post-office, or anything else whereby they can earn a living, but we do most seriously object to their becoming so insuperably immaculate in their business and beyond all rivalry as to shoot me down for attempting to imitate their worthy example. It seems, as my “protector” and “representative,” that they are out of their sphere. Is it possible that our governmental friends can swallow such a pill?

But they are to carry the mails “at cost!” Indeed, if my neighbor steals my horse, and runs it to death, then brings it back and says “Here is your horse, I have run it at cost,” what should I say? In the absence of all competition and contract, under the protection of force, how can the government run the post-office at cost? The conditions, the circumstances, the data from which cost is reckoned, are entirely absent. As well talk about a hot day in January, or a cold one in July as to talk about the government running a post office at cost. Just the opposite, is the case, the price is arbitrary, an emolument. The government never runs anything at cost, save at the people’s cost—and, alas, at such a cost, and the people without recourse! The three things which government came the nearest running at cost were the Hoosac tunnel, the Union Pacific railroad, and the Star Routes; the first it ran into the ground, the second it ran into the sky, and the third it ran up a tree! It is because competition would immediately destroy all this running of the post-office, by the government, “at cost,” that it has to get behind privilege. What a poor, stupid, brutal old blunderer she is, catching on to the coat-tails of the railroads and the express companies.* It would make no difference if the government could carry the mails for nothing, and throw in a free lunch at every way station; have not the people a right to establish their own initiative? Is man made for a machine, or is the machine made tor man? Forty dollars per capita, paid yearly to the government, is not a very cheap rate for carrying the mails. The post office is State socialism; neither can it stop there, there is no end where it may stop.

But no, neither nature nor progress indicate such a stultification. Science teaches the individuality of parts, the specialization of functions, and their harmonious co-operation under liberty and equity. Protestantism is not going back to Romanism, America is not going back to Europe, many corporations are not going back to one corporation, but all are going forward to a more complete co-operation. It was not an alarmist, but Emerson, who said, “When the government of force is at an end, roads will be built and the mails carried.” Already have we six railroads across the continent, where thirty years ago one was deemed impossible. We have got better traveling accommodations, at less price, and own one half the railroad mileage of the world. This has been brought about by the air of freedom that pervades individual, American enterprise.


* The miner patronizes the express companies because his letter will find the person to whom it is directed. The check bank, in England is taking the place of the money order. The government no longer carries the mails. It only, like the Czar, noses them over. To portray all its red tape inefficiency would fill a volume.


Heretofore we have reviewed the governmental aspect of corporations, now we come to their economical side, as the result of privilege. Beginning with a system of land tenure, borrowed from William the Conqueror, and a money system imported from the Rothschilds, the old governmental corporation dubbed a triple extract, called the railroad corporation, the tariff of which is fixed, according to Mr. Fink, on the difference in markets, or as we prefer to state it, according to what the traffic will bear, that is in the absence of competition, get all that is possible. If this seems too large a profit, then “water,” or adulterate, or forge, or raise the amount of stock. So the capitalization of the road depends, not upon what the road cost, but upon what the shippers can stand. If this revenue seems extortionate, let it be understood that it is the inevitable result of the situation. If any profit is just, this is logically defensible. If what the traffic will bear is not the proper basis, then there is none short of cost. Between these there is no middle ground, no maximum or minimum profit that is defensible. If a corporation should levy any profit why should it not be a high one? But if co-operation is to take its place, at cost, then will the taking of a small profit be as disastrous as a large one. The government attorneys and the railroads are in dispute as to what constitutes a net profit, is it one or one hundred per cent.? All profit is net, and one hundred per cent, is just as justifiable as one per cent. There is no logical stopping place to a net profit, but between any profit and cost, there is a definite distinction. And this distinction is parallel with the difference between a corporation and co-operation.


Mr. Gould said the Western Union telegraph stock was on a very sound basis, because it was so universally held. Suppose that everybody who contributes to the success of the Western Union, either in service or patronage, ‘drew a dividend in proportion to what each contributed, what would be the result? Would it not be taking money out of one pocket and putting it into the other? Would this be a dividend paying operation? It would be a losing operation, for the shipper and the workman would have to first pay out what they received. But, I mistake the real significance of the coupon clipper’s profession, its virtue lies in taking money out of another’s pocket and putting it in your own. You then have an “income,” the other fellow an outgo, a beautiful, economic equation! The dividend system then falls to pieces by its own weight. If everybody attempted to draw dividends, nobody could draw them, for they would be but drawing back what they had at first put in. The corporation, then, measured by its objects as well as its methods, finds no place in nature.

Who are necessary and essential to the successful running of railroads? Are the section hands, who keep the road in repair essential? O, no, they could well be disposed of. Are the brakemen, who keep the train together, necessary’? O, no, they are not needed. Are the engineers, the conductors, the superintendents of any consequence? O, no, they could all be spared. But the shipper, the patronage, the traveling public, who furnish the road business, are they of no account? None whatever, the road could run just as well without them! Who then are essential to the prosperous running of a road? Why, they are absentees, a vampire class, a foreign aristocracy, who dwell in New York, Boston, London, and Paris. These are the necessary factors on the directory; and the very ones, and only ones who naturally belong there, are absent! Alas, how generous are the horny handed sons of toil, that they should build roads every year and then give them away again! O free slaves of fair Kansas, “bleeding Kansas,” the state first to produce, but last to receive; how devotedly thou carest for thy wards, “they toil not neither do they spin,” but dine and wine, and ride, and attend the opera, and clip their coupons.


If there could be a dividend, it would belong to labor. Does not the laborer run all the natural risks? does he not put his life into his labor? does not his labor form capital? He is nature’s primal partner: who should share his product? Yet a partner with nature is nothing when compared with a stockholder, so much has labor and nature gotten into arrears to the legislature!

I have heard candidates for Congress, on the eve of an election, to show their interest in the labor question, offer to address the workingmen on “Capital— and labor.” I had not supposed that there was any such thing in creation, as capital, a long pause, then labor. I thought that there, first, had to be labor, and if it were not robbed, there would be no question about capital, it would take care of itself. Labor is so much green capital, and capital is so much dried labor. Justice to the one, implies security to the other, for, between the hand that produces and the thing produced, there can be no warfare. Imagine a workingman going into the woods to chop, on his shoulder he carries his axe, which is his capital. After the day’s work is done, how much of it belongs to the axe? A laborer first made the axe, and labor must keep it in order. But suppose the axe, some day, while thinking over the extra amount of wood that could be cut by its use, should go to Washington, and with other axes lobby for a change of status, whereby they might obtain the proceeds of seven tenths of the work. And, after a while, suppose some political economist, looking on, should write a commentary showing that this method of distributing property was a second law of nature? Why, the second generation of wood-choppers would swear that they knew no other than that axes employed choppers, instead of choppers employing axes, and that there should be a “fair division” of the profits between them! What fools will not people become after they have learned Latin? What justifications of thievery will they not undergo, provided it is sufficiently large, and hoary with age? And if any one should come along and say that axes could not produce axes, nor increase, he would be called a “crank.” “Did not our fathers tell us, and did we not drink it in with our mothers milk? Does not everybody take interest, and grind his axe against the face of the poor? What everybody says must be so.”

Not only axes cannot increase, but they have no rights. For persons, not things, possess rights. If the rights of the makers and users of axes are recognized, the rights of the owners of axes will be provided for. For, there would then be no owners of axes except as they were required for use. Otherwise it would require expenditure of labor to keep them from going to decay.

Now reverse the natural order. Confer upon the thing the prestige of legislation. Natural rights are then denied. The masses are defrauded. An unnatural order of drones is hoisted upon the community, called “capitalists.” Increase going to capital, compensation becomes arbitrary and deranged

Labor loses interest, is irresponsible, works against time, is bought and sold as a cheap commodity, instead of spared, as a human equation. The less labor produces, for the wages, the better for it. The cheaper capital can hire labor, the better for it, until one is turned into an animal, and the other is turned into ashes! Between such contradictions, of course there is an irreconcilable conflict, until the defrauded users of axes cut their masters’ throats.

Labor, then, or its concrete product, expressed in terms of labor, is the only capital. It alone creates, owns, and pre serves. Capitalists are laborers, and laborers are capitalists. Between the two, there is no conflict. Privilege having been abolished, labor comes to the top. For no one competes to labor, but to save labor. Natural forces being free, there is but one other factor in production, namely, labor. All skill, all commodities, all currency, all price, all property,—exceptional instances of possession aside, on the ground of equal liberty,—are based on labor. It is a very easy thing, then, to make the proper division between labor and capital, since all belongs to labor. If something should go to the increase of axes, then nothing belongs to labor. For, compensation for the increase of capital is diametrically opposed to compensation for the expenditure of labor. All the tolls to capital, then, rent, interest, and profit, under the general head of usury, is a legal fiction, compulsory “communism,” arbitrary “anarchy,” and the denial of the natural right of private “property.”

Now the average capitalist, as well as the average slaveholder, knows the system is wrong, and what is here said is true. He knows that we are all scoundrels, only he reasons that we are necessary scoundrels. So long as there are camels and lambs, there need to be tigers and wolves. Like the devils in the gospel, he knows that he is such, only he does not wish to be tormented before the time. But, to such, the time cometh, sometimes, by night, and as the dawn shows the assets, our capitalist may experience such a sudden conversion, as to declare: “Free labor is really cheaper’ than slave labor and not half so troublesome, I always was an abolitionist.” What will have changed this floater on the popular tide? First, the producer will get higher prices; the consumer gets his goods at reduced rates; the laborer gets higher wages; property is secure: strikes are abolished; capital and labor are at peace.

But how about the coupon-clipper? Is he not a participant in the general welfare? Can he lose by exchanging a bad system for a good one, a lie for the truth?’ All progress is a destruction of property, the symbol for the real. However, there is not an ounce of real property destroyed; its title only having been rectified. Whereas the capitalist now gets only ten per cent. as an individual, under the new order, he would, indirectly, get one hundred per cent. If his ship sinks, it only goes to a broader and better sea. Look at the industrial statistics of the South since the war. And yet I am willing to confess to that degree of charitable feeling that would take up a collection for the former masters. Not that there is anything coming to them, for, or from their former slaves, but on the ground of social adjustment, as in the transition from an old to a new machine. I do not believe the “widows and orphans” will miss their dividends on Wabash and the Missouri Pacific, preferred, as props for creeping infancy and declining age. If only all widows and orphans could thus be supplied, instead of the system’s turning out a constant stream of widows and orphans! Yes, a better investment can be offered instead, it is the certainty of a competence, arising from a maximum of production with the least expenditure,—the increased production amounting to more than the old consumption, enough and more than enough for all.


What shall be said is the actual labor cost of constructing and running a railroad? Need I be minute and particular, under this stupendous usury system, whether it be exactly more or less? When the thief brings back your silverware do you enter into microscopical considerations as to whether it is sixteen or eighteen carats fine? Would it not be trifling with my subject to enter into such details? I might show that the roads are capitalized for ten times what it cost to build them, and then show that they can be now built for one half of what they actually cost. Is it not sufficient to know that the net earnings of all the railroads for last year were two hundred and eighty four million of dollars? Is it strange, then, that while a man can be hired to wheel you about all day for one dollar it takes ten to get an iron horse to do the same? If it costs, under the usury system, one dollar to send a barrel of flour East, and two dollars per head to send a fat hog across the continent, what may it cost under a free system to send a man? If it costs one dollar per one hundred pounds for a publisher’s mail, a person weighing one hundred and fifty pounds in a bag of newspapers would cost one dollar and fifty cents.* Poor’s statistics on the average cost of hauling a ton one mile, in New York, is a little less than one cent. This would be equivalent to carrying a person, weighing one hundred pounds, twenty miles, for one cent, or one hundred miles for five cents. The Pennsylvania Railroad Company report that the cost of moving a train over their road has been reduced from sixteen to six cents per mile. The Society of Civil Engineers, at their Convention, June 25, 1885, reported the average cost of receiving, loading, handling, and hauling, on American railroads, to be less than one half a cent a ton, per mile. It costs more to stop a train, on a level track, than it does, for a long distance, to keep up the momentum.

These statistics are not offered as proof of any point, we prefer to appeal to the common sense of the average farmer, and ask him if he does not think and know that a hundred horse-power locomotive resting on two strips of iron pinned to blocks of wood cannot haul anything the community has to haul with a reasonable charge, and that this charge is within the means of all, and void of monopoly and usury, would be merely nominal, like postage, unfelt by every citizen, who has occasion to use the railroad and the telegraph? The fixed cost being the same for empty cars as for full ones, the secret of economy is in a broad and equitable policy. May I not further call this nominal rate tantamount to free electricity and free travel, since, where it costs more to make out a schedule of tariff charges than they would come to, a trip pass or a section message would take their place, just as has been done with postage. Whether this be five cents or ten cents a trip, or message, I only claim that the price for the use of these social functions, when shorn of their usury and monopoly, under co-operation, is within the means of all the people who have occasion to use them.


* See “Overland for One Dollar,” by W. D. Southworth. Public Lecturer. 284 Montgomery street, San Francisco, Cal.


The question now is how to bring this about, under co-operative principles. The methods proposed are directly in the line of evolution, by bringing a new and unrepresented, but all-powerful element into the field of organization,—railroad, not political organization. For, even repeal politics would first require a majority, then they would require a recognition that the law is a law before it can be repealed, then they would require you to be consigned to the political machine, the very agency that caused the thing complained of. But by actual self government, on the spot, you recognize the real, natural law of the situation, and by the inevitable process of cause and effect, accomplish your purpose. To be sure, no movement can rise higher than public opinion, but between the methods of co-operation and a corporation in manufacturing and utilizing this there is a wide difference. What public opinion? whose? where? when? Can we not well pass an indiscriminate, political, public opinion, when we have hundreds of shippers, interested parties, who are, not only converted but sorely indignant? Even if we had to teach the masses that railroading does not come within the province of government, then one road run at cost, would teach them more in a day than they could learn from political elections in many a year. But suppose the voters are caught, and the law repealed, without any business agency to execute it, the new law would be of no avail, for nature does not furnish any agency whereby an artificial law can be put into successful operation. In Ohio, recently, they passed a law that railroad hands should work ten hours a day, and the companies required all to sign a contract that they would work twelve, as twenty four was their regular running time. So, we come right round to where we began, with our political labors spent for our pains. As for the Commissioners, their office is not to remedy or change a system, but to patch up an old one; so far they are in the employ of the corporations; and what bungling patches they are required to make. None know better than they the limitation of their powers. They act within the statute They wait on the majority’s blind demands; they are honorable men; they draw their salaries and thus give employment to labor; but whether these amount to more than the rebates I do not know, I only know from the size of the usury bags that these have only been charged over in some other form. If usury is theft, then it is not a thing to be regulated; if the State is its father, then how can Beelzebub cast out devils? If cost is to take the place of usury, then this is the resultant of non-interference. Besides, meddling with other people’s business is a crime. The same folly may be attributed to “arbitration.” Can you arbitrate the sun’s rising? Can you post a ledger by arbitration? If a highwayman knocks you down and robs you, can it be arbitrated? You cannot arbitrate a fact in nature; the facts arbitrate themselves. Between an acid and an alkali there is no ground for arbitration; they neutralize. So it is between usury and labor. “Limited partnerships” are equally short sighted. They are only the last tricks of expiring usury, to throw a portion to labor. Such a “co-operative” conglomeration is a hybrid, half fool and half knave. No thoroughbred reformer will be caught with such a bait.

Co-operative methods being natural, are therefore the only ones that will accomplish the end. We have no time to waste, nor inclination to denounce the corporations. Being the latest and only organization in the field, they are the best existing. Until the people have sufficient self reliance to succeed them, of course there is no earthly power that can save them. First, because nature cannot save one who does not deserve it, second, because, as we showed under the co-operative store, the cost principle, or the demand basis, must get its initiative from a new, spontaneous, organization of the people. A capitalist cannot inaugurate it if he would, for the whole of capital will not reciprocate. But the producers and consumers having changed their attitude toward usury, will prove the only real salvation to genuine capital itself. As war had to precede slavery, and slavery had to precede agriculture, so the corporations had to precede co-operation. They are now being outgrown, and co-operation is to take their place.

The franchise of every road is the business that is done over it. It is secured not by any charter framed in Washington, but by the voluntary association of the people who contribute to it. A “pool” of this patronage holds the balance of power, and properly organized, can break any pool of the railroads. What is a weak, arbitrary, artificial, defensive pool, by the railroads, to bring the demand to the supply, compared to a natural, aggressive pool, among the shippers, to bring the supply to the demand? Let us call this pool the “Shippers’ Protective Union,” or “The People’s Transportation Bureau.” The scope of its operations shall be to build, buy, and run railroads. It shall, through its central agency, first consolidate and pool its through business. This would apply to farmers living in disputed territory, between railroads, and it would apply to all through traffic with competing lines. This would eventually invite the grain growers to control their own elevator facilities, and thus be enabled to control the supply on the market in order to control the Boards of Trade. Having this volume of traffic pooled, isolated shippers would be in a position, as well as the Standard Oil Co., to receive bids from the roads for this custom, and of course the pool would place it where it would “do the most good,” thereby breaking the railroads’ pool. For the purpose of building and buying railroads, this central agency, located at the nearest distributive centre, would receive pledges or subscriptions from five dollars up to five hundred, to be redeemed in service, at labor cost. If labor cost, under free competition, did not amount to more than one tenth of the present charge, then a subscription of five dollars would guarantee as much in return as a “rebate” of forty five dollars on a fifty dollar tariff. This would be equivalent to a “dividend” of nine hundred per cent. on the investment, or, if the subscriber should lose nine tenths of his subscription, the remainder would go as far as the whole, under usury. He would make, in his expenditure, nine times the present cost of railway service. In other words, for every trip that he would buy, he would have nine given to him for nothing. Quite an incentive, quite an inducement, quite a margin, not much to be lost in getting out of the hands of usury.

But this marginal fund, equivalent to a gift of nine hunhundred dollars on a thousand, thus eagerly pledged, will never need to be called in. A public enterprise, conducted at cost, a legitimate supply of an ascertained demand, unspeculative, backed by reputable property holders, what better bankable basis upon which to issue credits? Most assuredly would it be the best conceivable basis for hypothecation. Its certificates or bonds could not fall below par, and being without interest, they would never be above.

Shall we say that this organization is to build a road? Why not? when their surplus revenue is now building and giving away roads every year. Are there not plenty of strikers idle, sufficient to build many roads? Are there not plenty of farmers? supplies perishing for a market? So long as there are ties, iron, right of way, men needing work in which they can be inspired, producers needing markets, and consumers needing products, what is there to prevent? But, we shall not need to build any roads, there are too many roads being built by capitalists already. And, by a law they know not of, they are building them especially for you and me! All we have to do is to appropriate them. From our attitude, they not only fall into our hands, but come and beg to be taken care of. Suppose that we have one hundred thousand dollars worth of chrough business pooled, and five hundred thousand dollars pledged, with our agent in Wall street, backed by the whole state of Kansas, to what maneuverings of “bulls” and “bears” could not such a balance of power put an end! From our standpoint, how we could sell long and buy short, build up this road and break down that, and buy in at bankrupt sale. Or having got astride of its directory, by a majority-rule vote, freeze out the usurers, and squeeze out the water, until its financial basis comports with the cost of construction. Having possession of one road, run at cost, as a fulcrum, we are in a position to oblige all other roads to compete on the same basis. We need not change one employee, only the system, by granting them higher wages. Let them strike, there is now an identity of interest between the Grangers and the Trades’ Unions, a combination hardly possible before.

Now you say this is “impractical!” I am prepared to show how it is being done every day, only not for you. Jay Gould himself first set the example when he entered the street with “Erie” behind him. We only reverse his tactics. Repeatedly roads have been built and put upon the market just for blackmail, or hush money. What was the Nickel Plate railroad built for except to force Vanderbilt to buy it? What if the public welfare had been behind the Nickel Plate road so that Vanderbilt could not have bought it out, but, on the contrary, been compelled to sell to it. The Mutual Union Telegraph Company started expressly to so divide the patronage of the Western Union as to compel it to buy the Mutual Union, in order to preserve its monopoly. What if the Mutual Union Telegraph Company had been a real mutual union, what would have happened? Why, when the great strike occurred how easy a thing it would have been to have so crippled that old watered and decaying plant, bedridden with usury, so that it would have begged to be taken in on any terms.

“Impractical?” While I write, I hear the sound of the initiative from Minnesota organizing the Northwestern Telegraph Company to extend from New York to St. Paul. What is the key note to the enterprise? Let Mr. King speak: “There are no speculative fortunes to be realized out of the enterprise. Its chief benefits are to be in the reduction of rates. In this reduction it is supposed the Western Union will follow and the whole country be benefited. The real objects of the promoters are foreign to any speculative purposes. The stock has all been taken, mainly, by telegraphers who, if they get no dividends, will still be gainers.” There! that is just what we have advocated. Only we do not like the “if they get no dividends.” Rather, would I say, if they can see far enough, in proportion as they get no dividends will they be gainers. It is doubtful whether the Northwestern imbibes the full import of the possibilities herein described, but it certainly exhibits strong indications in that direction. Not that it fully takes in the co-operative philosophy, but that the co-operative philosophy takes it in, as the condition of a safe and successful business enterprise. There has lately been organized, in Kansas City, a “Transportation Bureau, “in which the merchants and Board of Trade combine to “wield the entire force of the community as a factor” in checkmating railroad monopoly. Another instance of the people taking the initiative. But will it be seen that this organization is so affiliated with usury, and so unweaned from the legislature, as to settle down upon an indefensible maximum rate, according to the prevailing rate of interest? Then will the work have to be carried on by a more independent class.


Further confirmation of the efficacy of our methods is the inevitable tendency of the old speculative system itself. While there has yet been little or no competition between the railroads and the public, there has been great competition among the railroads themselves. And, of all kinds of rivalry, that of contesting for territory is the most dangerous. At first the supply is speculative, then, through competitors, it is vastly overdone. What else can the railroads do but pool? Without a change of system the rope about their necks will surely hang them. They cannot help themselves; their help must come from the public under new ethics. There they stand in the pool against the public, as their last defense, and say:—“Here we stand, it is the best that we can do, unload us, or we perish!” So, we simply come to help unload them.

Their capitalization* has kept pace with their greed; their greed was large and they ran it up to eight billion dollars! This is only about fourteen times the amount of the circulating medium, and has been watered for long periods at the rate of only a million a day! And they hope to declare a dividend of six per cent, upon this small sum, mostly to be sent out of the country, “ heathen Chinee” that they be. There is no kind of property so dead as a bankrupt railroad, and there has not been but one road in Kansas that has not been in the hands of a receiver. All the roads the people need can be bought at bankrupt sale, out of the margins left, after selling “long” for rival lines; and perhaps the law, through Madame Grundy, will yet decide that every county railroad bond was issued for private purposes. There never was known to be such a cowardly thing as capital, and cannot labor trot out its “dark horse” and institute its “blind pools” as well?


* The Arkansas Central railroad built forty eight miles of poorly equipped, narrow gauge road for less than ten thousand dollars a mile. On this amount, it got from the State, for levy purposes, $160,000, and under another law, $1,350,000. Then it issued bonds to the amount of $2,500,000, 1,200,000 of which purported to be under first mortgage. There was, additionally, enough subscribed to make the total capitalization $5,200000. For nonpayment of interest, the road went into the hands of a receiver, who found it in such an unfinished condition as to require the issue of certificates. The road was finally sold, at auction, for 40,000. and paid for in shaved receiver’s certificates. The president of this road soon went to the U.S. Senate, and rumor says was offered a seat in the Cabinet. Popular Science Monthly Nov. 1885, p. 71.


Some look upon the land question as the great question, others think the money question is of greater importance, but the question of usury is the one question upon which all the others depend. The miner, for instance, may belong to his Union, and strike, only to find the price of coal is governed by the railroad, and that the road is the thing against which to strike,—the Trades’ Union becomes an anti-railroad league. The merchant marks his goods expecting his accustomed profit, but, to his surprise, he finds that a new rate to his neighbor has deranged all his calculations. The farmer may get a free homestead, he may get free credit, with which to till it, but if he cannot get his surplus products to market and realize living wages, of what use is free land and free money? The land question and the money question become the railroad question. The monopoly of money and land, Boards of Trade, grain and stock gambling, are all affiliated with the railroad usury system.

Not only does the railroad influence other industries, but the equitable organization of business will have a great deal to do with the normal organization of railroads. How many railroads will be needed, and where, from a social science standpoint? Had slavery never existed, who knows but that the railroad would have run north and south, instead of east and west; with the flow of rivers, the mountain ranges, and the flight of birds? When our great distributive centres are no longer congested with a forced distribution, from a monopolized currency, who knows how many spokes will be needed to radiate from the central hub? How will free trade and free money affect the trunk lines, when, instead of sending all the raw material East, with five hundred pounds of hog and hominy with which to keep an operative for a year to manufacture it into cloth and shoes, that we send and get the man once for all. In a word, when the land is no longer monopolized, when business is reorganized into an orderly system of bringing the supply to the demand, instead of bringing the demand to the supply, when automatic, local government exists, when society, as a whole, finds itself not antagonized by its ignorant and greedy parts, in short, when a natural order of things takes place, what new railroads will be required, and how many that are now built will pay a dividend?

Fellow slaves! bondmen are they who cannot control their own. The same inhuman greed that but a few short years ago, bought and sold the bodies of men, to enjoy its luxury and ease, is now at work, and would own your bodies, did it not already get your services and products without that trouble! Look, can you see the border of your plantation?—what an amount of arbitrary power is possessed by the lords of the rail! However wisely they might use it, does it not make your cheeks tingle with shame that it exists? Conceive of the grasp of these monster mastodons, these minions of the law! Where is there a crowned head that can exert half the power of the consolidated trunk lines? What monarch exhibits such violations of individual rights? And yet “free Americans” tolerate their “eminent domain.” Could we but catch a glimpse of the blessings of free travel, already within our grasp, we would no longer permit the fires of liberty to smoulder beneath the frozen zone of usury. “He who runs may read,” is now changed to he who reads may ride. In a short time you will see a road, run at cost, by individuals. Its administrative management will be as effective as the “natural selection” of individual genius can make it, and its economy in perfect keeping with universal equity.

This is their own total assessed valuation for both construction and equipment, in Kansas. Deduct $1,521.43, and we shall have $4,265.01, the total net earnings given below!


Kansas Generosity :—This table shows how many times the people of Kansas have built their railroads, and then given them away.

Total miles of road ………………………… 4,575

Average cost, with equipment, per mile …………… $48,518.05
Average amount of stock & debt, per mile …………… 60,106.75
Average amount of “water,” per mile …………… 11,588.70
Total amount of “water” …………… 53,000,000.00

Yearly usury (interest & dividends) …………… $10,409,863.50

Yearly usury, per mile …………… 2,275.38

Other net earnings, per mile …………… 830.76

Total net earnings, per mile …………… 3,106.14

Operating expenses, per mile …………… 3,380..18

It will be here noticed that the total net earnings are, within $274.04, equal to the operating expenses, therefore it will not be denied that the people of Kansas are paying a double tariff, or running two sets of roads. When a confidence man steals your ticket you are justly indignant, but here is an organized system that robs you of your fare every day in the year!

Now suppose that the $11,588.70 of watered stock was created within the last ten years, this would make a yearly addition to the net earnings of $1,158.87 making in all $4,265.01 the entire net earnings, per year and per mile. This is $884.83 above operating expenses, and according to the data above, on cost, it will be seen that the people come very near building and giving away the roads every year!

But this is not all the people of Kansas have given, in bonds, $844 83 per mile, and, in lands, $1,722.65 per mile, after the following manner:—


U. S. bonds, Un. Pacific, (in Kansas). .$10,185,820

State bonds …………… 27,806,000

County bonds …………… 2,338,000

City bonds …………… 6,000

Township bonds …………… 315,000

Donated, per mile …………… 844,82


All roads in Kansas, at $3. per acre. $7,881,170.12

“ average, per mile 1,722.65.

Atchison, Topeka & Santa Fe, in Kans 2,652,155.14

“ per mile, “ 4,449.34

Union Pacific “ 1,391,672.76

“ per mile, 2,459.89

This $1,722.65, per mile, in lands, and $844.82, per mile, in bonds, added to the $4,265,01 of yearly usury, makes $6,831.48, or $45.05 more than their assessed valve, or their labor cost of reproduction. And their “watered” stock, per mile, alone, amounts to $4,802.27 more than it would cost to build the roads! And yet we do not know how much of previous net earnings have gone into the building of feeders. All we know is the present lie-ability over outlay, admitted in their own brazen effrontery.

Now, gentle reader, wipe away the glamour of “the law,” and the superstition that hangs about a governmental corporation, look at things from a natural standpoint and then say which, in a societary sense, is the greater thief, Jesse James or Jay Gould? Size it up, you horny handed farmer, scratching at one end of the line for what the traffic will bear, while at the other the soft handed drones are compounding their principal! Think, you fifteen thousand brakemen, who are this year to be offered up a holocaust to greedy rapacity, against what, and how you are to strike!

The above is only one sample of the whole of that stimendous usury system which strikes its roots down beneath legal property. Being constructed, it never feels or sympathizes. The Czar as sole corporate, has eyes and ears and hands, can smell a rose, can taste and feel, can weep and smile, get sick and die. But a railroad corporation being wholly constructive, has no human quality, no heart, no soul, no conscience, nothing that can be appealed to. All its acts are organic, not individual. Its only sense is for dividends. And since it lives on what it feeds, there is no logical end to its greed. The best men, acting a part of this legal machine, would use a human being for a brake, if it only cost less. After the Ashtabula disaster, Anson Stone killed himself from compunction of conscience. But the corporation moves right on in the path of the old English law of primogeniture arid entail.

It has a sort of double-acting jaw, whichever way it moves it is sure to pay. While it is responsible for the profits, it lets the public shoulder the losses. With one jaw it opens up on the prairie sucker, with the other it closes in on the Wall street lambs. Think of the crushing power the people have installed over themselves. Seven railroad corporations employ two hundred thousand men, at the same time one man can control four hundred million dollars. There are no longer so many states in the Union, but so many trunk lines of railway. The government is no longer in Washington but in Wall street. The Stars and Stripes are only a jumbled-up mess, in the form of a serpent representing a railroad corporation. The Supreme Court is a kind of umbilical cord, yet so fast have these new corporations of electricity and steam distanced the old political corporation that they may be said to be the government. Gould boasts that he worked several states at once; and Vanderbilt acknowledged that he could buy legislatures cheaper and surer than voters; and Tom Scott “moves that this legislature do now adjourn,’’ Give us industrial supremacy, and the people may have their political buncombe. The freebooter rides over the ground in his palace car, looks over the crops, takes notes from his station agents, retires to his Wall-street retreat, makes up the slate for Texas, Kansas, and Nebraska, by adding five cents more per hundred, thus making a good crop into a poor one for the farmer, and a poor one into a good one for the stockholder! Through this wholesale exploitation, we have an American aristocracy, or caste, not of blood or brain, but brass, display, based on stolen goods!

What then is the upshot of the whole matter? Tyranny and privilege must cease, wherever incorporated, for whatever purpose. Society must learn, by the rudder or the rock, the fundamental principles of co-operation. When that is done, the conflict between labor and capital will be as obsolete as the conflict between science and religion. If the methods of liberty are adopted, usury may be eliminated peacefully, naturally, harmoniously, as a serpent sheds its skin. But if political methods are pursued,—the caucus, majority-rule, force, numbers, strikes, the militia, then the worst that Phillips or Lincoln ever prophesied will come to pass:-”) affirm it as my conviction that class laws placing capital above labor are more dangerous to the Republic at this hour than the chattel slavery in the day of its haughtiest supremacy.”—(Lincoln) “This labor and capital question is one to have as angry an agitation as slavery caused, and unless settled, republican institutions will go down before moneyed corporations.”—(Phillips)


“I always told you that not having enough sunshine was what ailed the world.”—Lydia Maria Child.

The first six numbers of The Sun will contain the following subjects, and will be sent to any address, on receipt of ten cents.

CO-OPERATION: ITS LAWS AND PRINCIPLES. Showing the Grounds of Liberty and Equality. and their Violations in Rent, Interest, Profit, and Majority Rule.

THE REORGANIZATION OF BUSINESS. On a Labor, Instead of a Usury Basis. Embracing the Store, the Bank, the Farm and Factory.

THE RAILROADS. Showing how the Shippers can break the Pools, control the Directories, and conduct the Roads at “Cost.”

THE CO-OPERATIVE HOME. Or the Abolition of the Kitchen.

THE LAND QUESTION. Showing a natural and peaceful way of Starving out the Landlords.

THE CO-OPERATIVE REPUBLIC. Showing what is to “take the place” of “Government.”


“PROHIBITION:” Or the Relation of Government to Temperance.

Co-operation is fully equipped and dates a new departure. Its principles of Liberty and Equity are definite in the nature of things, not the Will-o’-the-wisp of party faction and sectarian controversy. Its methods, also, are neither those of the politicians, the theologians, or their attenuated disciples, the reformers. It neither whines, nor coddles, nor denounces. It is sweet, hopeful, and self reliant. It accepts fully the doctrine of the survival of the fittest hereafter as well as heretofore. It plants itself freely upon it, and invites the issue, knowing what the fittest is and how to inaugurate it. It opposes all infringement of the freest competition, as the only natural, safe, and sure conditions of co-operation.

Its Cultus is the principles of Liberty and Equity.

Its Economy is in equitably rewarding the utmost division of labor.

Its Polity is its power to organize the masses on a plane of self interest.

Its Power is in the fact that it is reinforced by natural law and the “survival of the fittest.”

Its Social Ideal is the future American Republic.
Its Religion is the Unity of mankind.

Its Consummation is human Solidarity, under one government one language, and one religion.



About Shawn P. Wilbur 2096 Articles
Independent scholar, translator and archivist.