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The Commoner.
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MABCH J, 1905
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6NT VPICS JJHf
A GREAT FIGHT has been raging in the high
circles connected with the Equitable Lifo
Assurance society, said to be the greatest single
financial power in the United States. A New York
telegram to the Pittsburg Dispatch, under date of
February 15, said: "This fight exceeds in bitter
ness any struggle that has ever developed among
Icings of finance in this country. The demand
made by James W. Alexander, president of the
society, that James H. Hyde, its vice president
and owner of a majority of the capital stock, shall
consent to a change in the voting plan by which
the 500,000 policy holders of the company shall
have a voice in the election of its directors, is
only a small part of the real struggle. Mr. Alex
ander and his friends in the company demand, and
thi3 is the real crux of the war, that Mr. Hyde
shall retire from the vice presidency of the com
pany and from all active participation in the
management of its affairs. Mr. Hyde has been
served with a notice to this effect, and unless
he retires at a meeting of the directors set for to
morrow the consequences may be the most remark
able in the financial history of this country."
ACCORDING to the same telegram, thirty-four of
the executive head3 of the Equitable Lifo
Assurance society, constituting the whole active
management of the immense corporation, with
the exception of the vice president, Mr. Hyde, and
the fourth vice president, W. H. Mclntyre, have
signed an agreement declaring that unless Mr.
Hyde resigns they will give up their positions in
the company. When it is remembered that tho
Equitable Tife Assurance society has in ready cash
and securities, which can be immediately turned
into cash, $478,000,000, and when it is also remem
bered that some of these men who have threatened
to resign have been with the company since it was
founded, in 1859, by Henry H. Hyde, father of the
young man who they now insist must resign, the
motives which impel them to take thia extraordi
nary step can readily be understood to be excep
tional. One of these motives is the private life
of Mr. Hyde. Old men in the company who were
his father's friends, ddclare that while they are
still loyal to the memory of Henry B. Hyde, they
know that were he living he would not tolerate in
a position of responsibility in the company any
young men, even his own son, who had led the
frivolous life credited to young Mr. Hyde.
ANOTHER OBJECTION to Mr. Hyde, says thi3
dispatch is the charge that he has formed
financial associations of a character that is detri
mental to the Equitable company. They say that
he has gone into huge speculative schemes or has
allowed himself to be used by the promoters of
such schemes, and that in consequence this abso
lute one-man control of the $478,000,000 of the
Equitable society is a crowning injustice to the
half- million policy holders in the company. Not
only have these men determined to oust Mr. Hyde
from the company, but they also have agreed
.among themselves that Jacob H. Schiff, head of
the great banking house of Kuhn, Loeb & Co.,
must retire as a member of the finance committee
of the Equitable Life. Mr. Schiff Is one of the
few -known supporters of young Hyde in the pres
ent gigantic struggle. It is stated that the reason
they object to Mr. Schiff's continuance as a mem
ber of the finance committee of the Equitable Life
is that during the last year his firm, Kuhn, Loeb
& Co. sold to the Equitable $22,000,000 of bonds.
AT A MEETING of the Equitable directors held
February 6, Mr. Alexander was elected presi
dent and Mr. Hyde was re-elected vice-president.
This was done after Mr. Hyde had consented to
the retirement of the stock and to the "mutualiza
tion" of the company, which, it i3 explained, means
that all policy holders have the right to vote. A
committee of seven was chosen and this committee
will report April 12.
THE FIGHT against the Standard Oil Trust by
the people of Kansas is attracting world-wide
attention and people in all sections of the country
are showing their sympathy for Kansas. On Feb'
ruary 21, tho Illinois legislature adopted a reso
lution offering to lend tho state of Kansas tho sum
of $100,000 without interest, for a period of six
years to aid in establishing a stato oil refinery.
This resolution refered to the Standard Oil trust
as "that merciless octopu3 whoso tentacles now en
circle every state in tho union." Another resolu
tion provided for tho appointment of a joint com
mission to confer with the stato officials of Kansas
and to agree on steps to bo taken for pipe lines to
aid common carriers. Indiana oil producers havo
organized to fight the oil trust and they will urge
the erection of a stato refinery. Tho bill ha3 been
introduced in tho Texas legislature, making tho
pipe lines of that stato available to independent
producers and it is proposed by somo that tho
state erect a refinery. Oklahoma Is likowiso con
sidering tho erection of a stato refinery, together
with the proposition to make oil producers preserve
a uniform price throughout the stato.
AN INTERESTING DESCRIPTION of the trou
bles between Kansas and the oil trust is
given by Frank P. Gallagher, the staff correspon
dent for the Omaha World-Herald, in a dispatch to
that newspaper, under date of Topeka, Feb. 21. Mr.
Gallagher says: "It was a bitter experience with
the sinister influences of Standard Oil that led the
people of Kansas, but as late a3 two years ago tho
oil industry amounted to little. Twelve years ago
Standard Oil wriggled into Kansas under the de
ceptive title of the Forest Oil company. Depart
ing from its historic policy, the Standard Oil man
agement determined to develop the fields without
waiting for the people to catch the oil fever. Near
Neodesha, in Wilson county, many wells were
sunk, but the oil refused to gush-and the borings
were abandoned. Standard Oil relinquished its
leases to hundreds of acres and surrendered the
task of development to the prospectors and pro-
moters."
THE FIRST IMPORTANT STRIKE was made
by Charles Knapp, six years ago, at Chanute,
near one of the abandoned properties of tho For
est Oil company. A little later it was found that
Peru, Kan., was located on a vast oil deposit. Soon
nearly every town lot had its oil well, and the For
est Oil company returned to the field with renewed
vigor. As the business developed the Forest Oil
company underwent several changes. Its small
capitalization disappeared, and on January 7, 1901,
it took the name of the Prairie OH and Gas com
pany and increased it3 capital stock to $2,500,000.
Tho company then built pipe lines to Neodesha
from Chanute and at the latter point a refinery
was established. In 1902 the supply of oil was
still unsatisfactory to the Standard Oil folk, and
in order to create a boom it suddenly raised the
price of crude oil from 90 cents to $1.10 a barel.
The effect" was magical. In twelve months the out
put grew from 322,000 barels with a value of $289,
000 to 1,018,000 with a value of $1,120,018. A
greater part of the output was taken by the
S'tandard Oil company, but each day E. J. Web3ter,
who has built an independent refinery at Humboldt,
Kan., took 200 barrels.
IN THE MEANTIME, Standard Oil, according to
Mr. Gallagher, had been whetting its cimitar
with the intention of striking down tho entire Inde
pendent oil industry of Kansas. The capacity of
its plant at Neodesha was added to until it had
reached 300,000 barels of crude oil a day. The
pipe lines wore extended until tho main conduit
ran from Tulsa in the Osage nation south of the
Kansas 3tato line through Kansas to Kansas City,
Mo. At Caney, Neodesha, Altoona and Humboldt,
the Prairie Oil and Gas company built giant tanks,
and began to store oil. By January 1, 1905, it had
a total stock on hand of 5,448,034 barrels. Until
last August, when the Standard finished its sys
tem of pipe lines through the 3tate, oil had been
bringing prices ranging from $1.20 to $1.40 a bar
rel, according to its specific gravity. It was at
this juncture that Standard Oil sprung its trap,
in which the oil producers and consumers of Kan
sas and tho single independent oil refiner, E. J.
Webster, are still squirming, but with a show of
life that astonishes the captor. The price of crude
oil began to fall. In four reductions tho prices
wore cut to 72 cents for a barrol of tho best oil.
Another smash of 2 cents was mado on January
31, 1904. To what a low lovol prices for cnido oil
had sunk is illustrated In tho following compara
tive table: Wcstorn crude oil prlqes -32 dogroo
and above, 70c; 31 to 32, C5c; 31 to 31, GOc;
30 to 31, 55c; 30 to 30, 50c; 29 1-2 to 30, 45c;
29 to 291-2, 40c; 281-2 to 29, 35c; 28 to 281-2,
30c; 22 to 28 heavy, 29c per barrel. Bartlesvillo,
I. T., 82c per barrol. Eastern crude oil prices:
Pennsylvania, $1.40; Tlona, $1.55; Corning, $1.07;
Now Castle, $1.32; North Lima, 93c; South Ioina,
88c por barrel. Indiana, 88c; Somerset, 81c; Rag
land, 53c; Petrolla, Ont., $1.33 per barrol.
THE PRAIRIE OIL AND GAS COMPANY then
mado such rules relative to teats that tho
owner of a high quality of oil received no more
than one whoso output was of an inferior quality;
moreover, tho Standard Oil's inspectors did all
tho grading. In somo Instances they graded tho
oil high and when tho time camo to buy thoy re
graded the same oil in a lower classification. There
wore other injustices that aroused intense Indigna
tion among tho producers, but tho worst blow
was yet to fall. As soon as the Standard had com
pleted Its conduits it could transport Its oil with
out shipping by rail. This the Independent dealer
could not do. It was then that tho railways ad
vanced tho rates from 10 cents to 17 cents por
100 pounds. In addition to this, tho railways arbi
trarily ruled that a gallon jshould be hold to 7
instead of 4 pounds. Tho effect was to raise the
cost of shipping a car of oil to Kansas City and
other river markets from $$45 to $98. The further
effect was to prevent tho producers from shipping
their oil and thoy were compelled to accept Stand
ard Oil price3 at tho wells. Tho most remarkable
fact in this connection is that tho four railways
Involved, tho Santa Fo, the Missouri Pacific, tho
'Frisco and tho Missouri, Kansas & Texas, abso
lutely went out of the lucrative business of trans
porting oil and they did this simply because the
Standard had so commanded.
SPEAKING to this correspondent, J. M. Parker,
secretary of the State Oil Producers' asso
ciation, said: "If tho railways would give us tho
original rate of 10 cents per 100 pounds, or $45 a
car, we could ship all of our oil to Kansas City and
other points and it would give U3 $1 per barrel at
tho well. It would give the railways 100 carloads
of freight every day. But the Standard Oil com
pany tells the railroads to desist from hauling
any oil whatever, and by an exorbitant rate forc
ing us to sell to the Standard, the only market
in the fields, at a price of 47 cents a barrel, which,
under the compulsory rates demanded from tho
railways by the trust, nets the producer 7 cents
more than if he had used tho railways."
MR. GALLAGHER adds: "While the men who
are attacking Standard Oil realize the great
power of this corporation they express confidence
that Kansas will yet be able to gain the mastery.
I regretted that I could not bring to them better
cheer from Nebraska, the sister state. When I told
them that Nebraska, far from trying to cast off
the yoke of the octopus, was about to put it on by
erecting a Rockefeller memorial, I saw in their
eyes not a little consternation and a steely glint of
scorn and resentment. They have a habit of being
in deadly earnest down here. The people are a
unit against Standard Oil. Consequently it is dif
ficult for them to realize that any stato in the
union, least of all Nebraska, should regard Rocke
feller bondage with anything but aversion and hor
ror. Secretary Parker of tho Kansas Oil Pro
ducers' association gave expression to this idea
when he said: "The legislature of Nebraska is in
session. It has a duty to perform. It should take
such action as will render the acceptance of a de
grading gift front Rockefeller Impossible. Natur
ally it is inconceivable to us hero in Kansas that
such a plan 3hould ever have been entertained.
It would be dreadful if Nebraska should bo content
to wear such a badge of senility."
THE ATTENTION of the Nebraska legislature
was on February 22 directed to the struggle
between the Standard Oil trust and tho stato of
i
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