14 " "BfTTf" iy",pr,5Kjs
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The Commoner.
.VOLTTMH 6, NUMBER
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How Mr. Hughes Dropped the Promising Line of Inquiry
Referring to an articlo that appeared in The
Commoner relating to Charles E. Hughes and
the insurance investigation tho Nov York World
says that Tho Commoner is in error in intimat
ing that there was any relation between Mr.
Roosevelt's "muck rake" speech and the insur
ance investigation. The World says tho investi
gation ended December 31, while the "muck rake"
speech was not made until April 14, and that
"when Mr. Roosevelt delivered his 'muck rake'
speech Mr. Hughes had already drafted his great
code of insurance reforms and most of tho hills
had been passed by the legislature."
To that extent, then, The Commoner was in
error.
But The Commoner does not feel that it has
done Mr. Hughes an injustice in directing atten
tion to some of the conspicuous omissions that
characterized tho investigation by the Armstrong
committee.
For instance, wo are reminded by a writer
in the New York Journal that the American Bar
association's committee on insurance laws re
ported: "The most conspicuous exhibition of
legislative unwisdom is found in tho bills
prepared by the Armstrong committee and
passed by the New York legislature. The
most conspicuous, because it has had tho
widest advertisement, and BECAUSE OF THE
THINGS WHICH THE COMMITTEE MIGHT
HAVE DONE BUT FAILED TO DO and its
ignorance of the subject confessed."
Full credit has been given by The Commoner
to the work Mr. Hughes did as an attorney for
the investigating committee. So far as Mr.
Hnghe3 went tho work was excellent; but he
did not do all that he could have done, nor all
that he should have done; and the record will
sstablish the claim that "he inserted his probe
wily deep enough to make the republican party
managers wince," and then dropped the most
promising line of inquiry that developed during
the committee's sessions.
In spite of tho fact that great service was
done to the public interests by the Armstrong in
vestigating committee and by the work of Mr.
Hughes, it is true that there was an air about
that committee room, whenever the insurance
magnates entered, that was not at all in keeping
with the serious charges under investigation.
For instance, when Mr. Ryan, who succeeded
Mr. Hyde in control of the Equitable, took the
stand the following dialogue took place:
The Chairman: "Mr. Ryan, the committee
does not want you to think it is being officious in
the matter."
Mr. Ryan: "I know that."
The Chairman: "It thinks you performed a
great public service and is only seeking to get
you to complete that service."
Mr. Ryan. "I still think that I should not
be required to answer."
Mr. Ryan paid $2,500,000 for control of the
Equitable. Honestly, he would have received
on that investment only $3,514 in dividends, but
in purchasing the Equitable stock, Mr. Ryan ob
tained control of tho Equitable and in controlling
the Equitable secured control of about $413,000,000
of policyholders' money.
Plainly Mr. Ryan was not actuated by any
deep seated concern for the public welfare when
he paid $2,500,000 for stock which, legitimately,
returns only $3,514 in dividends; and, plainly,
tho Armstrong committee showed a disposition
to grovel, when, through its chairman, it ex
pressed tho opinion that Mr. Ryan "performed
a great public service." And wo remember dis
tinctly that the Now York World itself said that
while the reign of Hyde was "a public scandal"
the reign of Ryan is "a public menace."
How does it happen that after all tho noise
attendant upon tho Armstrong committee's labors
tho only prosecution was against a $65 per month
clerk who was held on tho charge of perjury
. ah. nufiuuH moors were as morough as they
have been credited with being, how does it hap
pen that they did not produce sufficient material
to justify tho prosecution of some of the more
conspicuous rascals?
It was in November or December ion; ttm
the New York World told us Tat Vhariea E
Hughes received a tip to the effect that during
the months of September and October 1904
cloven corporations doing business in New York
UUU"1UI!U " iuua aggregating $225,000 Ac
MBM? 'of th,1Wor,d W5to contributed
?iU.UUU Of this amnnnf nn i,
ments lor a number o subscriptions, IncluTng
the $25,000 given by the Equitable, were made
by George B. Cortelyou. The World furthor
stated that these contributions were made upon
tho representation of various persons, including
Mr. Cortelyou, chairman of the republican na
tional committee, and Mr. Bliss, treasurer of
that committee, to the effect that additional
money was needed to insure Mr. Roosevelt's
election. In that same article the World said:
"Friends of Piatt, Depew and Odell think
that THE COMMITTEE HAS BEEN TOO
LENIENT WITH THE NATIONAL ADMIN
ISTRATION AND IS PURPOSELY WASTING
TIME OVER THE TRIVIAL INSTANCE OF
'GRAFT' IN ALL THE MANAGEMENT OF
THE COMPANIES IN ORDER TO SHIELD
THE INFLUENTIAL POLITICAL BENE
FICIARIES OF COMPULSORY CONTRIBU
TIONS. A financier of high standing who ad
mits having assisted in the collection of
some of the contributions is authority for
the statement that Mr. Cortelyou can throw
more light directly upon the contribution made
by the Equitable than either Piatt, Depew or
Odell, and circumstances under which it was
made and the manner in which it was paid."
The gentleman from whom the World ob
tained its information was quoted as saying:
"If Mr. Hughes will call Mr. Cortelyou to the
stand and will summon Cornelius N. Bliss, he
and the public will then learn definitely whether
the president based his statement upon accurate
information or whether he was misinformed. Men
who subscribed to the fund will also learn if
the persons who solicited the fund were 'autho
rized to do so with the knowledge of the president
and whether the man or men who collected the
amounts subscribed were empowered to collect
them. The committee will soon end its labors,
according to the present plans, and the public
would like to have this phase of the investigation
clearly revealed. Mr. Hughes and the commit
tee have shown up a lot of graft, and the public
is thoroughly convinced of the rottenness of
things generally in the management of the in
surance companies. The political features of the
expose will never be complete without a thorough
ventilation of the national campaign contribu
tions of 1904. Mr. Cortelyou, Mr. Bliss and per
haps Piatt and Odell should be called to the
stand again before the investigation is brought
to a close. The petty graft can be attended to
later. Nothing is more important now than the
vindication of the president's positive declaration
that the corporations did not contribute to the
campaign fund used in promoting his election.
Mr. Hughes can bring out the information by
calling the men in possession of it. He knows
who they are."
It will be observed that the World itself
was the first to give publicity to the charge that
"the committee has been too lenient with the
national administration and is purposely wasting
time over the trivial instance of graft in all the
management of the companies in order to shield
the influential political beneficiaries of compul
sory contributions."
Just as the writer in the World said, Cortel
you and Bliss could have told interesting stories
but Mr. Hughes did not call them.
It was in March, 1906, that the chairman of
the democratic national committee offered to
appear before the house committee on elections
if Mr. Cortelyou of the republican committee,
would do the same and testify as to the contribu
tions received in 1904. Referring to this offer
the New York World said: "Has not President
Roosevelt sufficient influence with Chairman
Cortelyou to induce him to accede to this fair
proposition. It should be an opportunity dear to
the president's heart."
It was just as important that Chairman Cor
telyou testify before the Armstrong committee,
but Mr. Hughes, the World's candidate for gov
ernor, evidently did not "have sufficient influence
with Chairman Cortelyou to induce him to ac
cede to this fair proposition."
It will bo remembered that Andrew Hamilton
the insurance lobbyist, testified before a New
York legislative committee In March, 1906, that
in 1896 he paid to C. N. Bliss, of the republican
national committee, $75,000 for that committee
Ho produced Mr. Bliss' receipt for the same That
is one of the small items which Mr. Hughes did
not bring out in his investigations and wh ch
would have been produced had Bliss and Cor
telyou been summoned.
In tho Hughes investigation it developed that
$148,000 had been contributed to tho republican
campaign fund by the New York Life, but after
Mr. Hughes had finished his work and in March
1906, tho New York World quoted Lou Payn
former insurance commissioner for the state of
New York, as saying that $148,000 would not
oven cover the amount contributed for the bene
fit of the republican party in New York state
alone.
In the proceedings before Justice Greenbaum,
when it was held that these political contribu
tions constituted larceny, Attorney Jerome said
to the jury: "If Justice Greenbaum's ruling bo
sustained, it will be necessary to call as wit
nesses Cornelius N. Bliss, treasurer of the re
publican national committee, and George B. Cor
telyou, its chairman and postmaster general, and
indict a large portion of tho officers of every
financial institution in the state." At the time
Mr. Hughes was conducting his investigation
there was no question as to whether these con
tributions constituted larceny. Indeed, Mr.
Hughes was generally complimented because ho
had uncovered several big steals. But he did
not summon Cortelyou or Bliss and although his
probe had worked up to a very interesting point,
he failed to pursue the inquiry along tts logical
lines; and it was the opinion of the New York
World, as well as the opinion of many other great
newspapers, that by putting a check upon the
investigation when the finger of duty pointed
plainly to the president's cabinet, Mr. Hughes
failed to take advantage of a great opportunity
for safe-guarding public interests and for bring
ing to justice conspicuous men who had partici
pated in the misappropriation of trust funds.
Have we not the right to point to the fact
that the Mr. Hughes who failed to pursue this
line of inquiry just as the New York World and
other newspapers urged him to do is the same
Mr. Hughes who was George B. Cortelyou's candi
date for the republican gubernatorial nomination
in New York; the same Mr. Hughes, who in
the pending campaign, as the enthusiastic sup
port of the money-gamblers and the trust mag
nates whom he exposed when "ho inserted his
probe only deep enough to make the republican
party managers wince?"
Even in the editorial to which The Com
moner is now making answer, the World points
with pride to the fact that it was the first to
urge Mr. Hughes to call upon Bliss and Cortelyou
to testify. But why did not Mr. Hughes accept
the World's valuable suggestion?
The World reminds us that it suggested that
Hughes call ten witnesses, as follows: Thomas
F. Ryan, Grover Cleveland, David B. Hill, Gov
ernor Higgins, Mr. Odell, Senator Piatt, Senator
Depew, Superintendent Hendricks, Mr. Bliss, and
Mr. Cortelyou. Then the World says:
"Mr. Hughes proceeded to put Mr. Ryan,
Mr. Odell, Mr. Harriman, Senator Piatt, Sen
ator Depew and Superintendent Hendricks on
the witness stand. Mr. Hill was subpoenaed,
but was too ill to appear. A committee of the
State Bar -association afterwards unani
mously acquitted him of unprofessional con
duct. Mr. Higgins, as governor of New York,
could not be subpoenaed."
But of the ten witnesses suggested by the
World there were three whom Mr. Hughes did
not call. He did not call Grover Cleveland, Mr.
Bliss or Mr. Cortelyou. Why did he not call Mr.
Cleveland in order to ascertain some of the facts
with respect to the Ryan reorganization of tho
Equitable the Ryan reorganization, which in tho
language of the New York World itself is "a
public menace" even as the Hyde regime was
"a public scandal."
?diafter Mr' HuShes had brought out the
fact that certain contributions had been made to
the republican party by these insurance compa
nies, why didn't he call Mr. Cortelyou, the chair
man, and Mr. Bliss, the treasurer of the repub
lican committee, and require them to show all
the facts with respect to campaign contributions
by Insurance companies?
Why did he fail to call to the stand Secretary
of State Root? It came out during tho investiga
tion that Mr. Root was raid by the insurance com
pany large sums of money for services as attor
ney. Even the New York World insisted that Mr.
Root be called to tho witness Btand, but Mr.
Hughes failed to pursue the advantage he had
when Mr. Root seemed a promising witness.
The World says "Mr. Hughes' investigations
destroyed Piatt politically, Depew politically,
Odell politically, and utterly wrecked the old
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