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HISTORY 1865-1910] Union Pacific to acquire the Southern Pacific with the Central Pacific, and by 1906 he was dictator of one-third of the total mileage of the United States. Meanwhile the Great Northern and the Northern Pacific had been brought into friendly working arrangements under James J. Hill, and tried to secure the Burlington railway. A fierce contest followed between the Hill, Morgan and Harriman forces, resulting in a compromise by which the Northern Securities Company, a holding company for the joint interests of the contestants, was created. It was admitted by the counsel for this company that the machinery provided

in this organization would permit the consolidation of all the railways of the country in the hands of three or four individuals. By using notes of one railway company, based on its treasury securities, it was possible to acquire a controlling interest in others; and by watering the capital stock to recover the cost of the undertaking, while the public paid the added rates to supply dividends on the watered stock.

395. Following a similar tendency the great Wall Street banking houses were dominated by the large financial groups in the interest of speculative undertakings, the directors of banks loaning to themselves, as directors of industrial combinations, the funds which flowed into New York from all the banks of the interior. By a similar process the great insurance and trust companies of New York became feeders to the same operations. Thus a community of control over the fundamental economic interests of the nation was lodged in a few hands. Rebates and discriminations by the railways gave advantage to the powerful shippers, and worked in the same direction.

396. Such was the situation in domestic affairs which confronted Roosevelt when he became president. In his first message he foreshadowed his determination to grapple with these problems. In 1903 he instructed the attorney general to bring suit to dissolve the Northern Securities Company as a combination in restraint of trade, and in 1904 the Supreme Court held the merger illegal. But the effect was to increase the tendency to change from incomplete combination of financial interests to consolidated corporations owning the property, and to lead the government, on the other hand, to

seek to regulate these vast business interests by legislation. The Elkins Law, passed in 1903, increased the power of the interstate commerce commission to prosecute offenders, especially those who violated the anti-rebating clauses. In the same year the creation of the Federal Bureau of Corporations provided for increased publicity in the affairs of these organizations.

397. Labour was combining in its turn. Not only did local unions in most of the trades increase in number and power, but

workers in separate industries over large areas were combined for collective bargaining and the national organization, the American Federation of Labor, had a membership by 1905 of approximately 2,000,000. Labour legislation by the states increased under these influences, and political leaders became increasingly aware of the power of the labour vote, while employers began to form counter organizations to check the growth of the movement. In 1902 Pennsylvania members of the United Mine Workers of America, led by John Mitchell, struck. Inasmuch as their employers were the owners of the anthracite coal monopoly under the control of an allied group of coal-carrying railways, the contest was one of far-reaching importance, and soon brought about a coal famine felt throughout the nation. So threatening was the situation that President Roosevelt called a conference of the contestants, and succeeded in inducing them to submit their difficulties to an arbitration commission which, by its report, in the spring of 1903, awarded to the miners shorter hours and an increase of wages.

398. Steadily the United States enlarged its economic functions. In 1903 Congress created a Department of Commerce and Labor and made the secretary a member of the cabinet. The reports of this department gave publicity to investigations of the perplexing industrial conditions. The Department of Agriculture

enlarged its staff and its activity, investigating diseases of plants and animals, ascertaining means of checking insect pests, advising

upon the suitability of soils to crops, seeking new and better seeds, and circulating general information. The contemporaneous development of agricultural education in the various Western and Southern states whose agricultural colleges had been subsidized by land grants and appropriations by the Federal government, and the experimental farms conducted by railways, all worked to the same end. Congress passed acts to limit the substitution of oleomargarine for butter (1902) and provided for the limitation of the spread of live-stock diseases (1903). The nation began also to awake to the need of protecting its remaining forests, which were rapidly falling into the hands of corporations by perversion of homestead and other land laws. President Cleveland had withdrawn large forest tracts, and in 1898 Gifford Pinchot was made head of a division of forestry in the Department of Agriculture. In 1901 the work was organized under a separate bureau, and four years later the National Forests were placed under his management.

399. The increasing demand for lands for agriculture led also, under Roosevelt, to the real beginning of national irrigation

actively in the vast arid area of the Far West. The Reclamation Service was created by the act of the 17th of June 1902, which set aside the proceeds of the sale of public lands in thirteen states and three Territories as a fund for irrigation works. The government itself reserved timber and coal tracts, water powers and other requisites for construction, and sold the irrigated lands to actual settlers in small farms, while retaining title to the reservoirs and the works. The income from the reclamation fund between 1901 and 1910 aggregated over $60,000,000 By the use of suitable crops and dry farming agricultural occupation was extended into formerly desert lands.

When corruption was discovered in the Land Office and Post Office, Roosevelt, instead of yielding to the effort to conceal the scandal, compelled effective investigation. Two United States senators were convicted of land frauds. The application to all kinds of lands, whether coal lands, timber tracts, water rights or other natural resources, of the general principle of homesteads governing the acquisition of agricultural lands, had invited fraudulent entries. The Homestead Act of 1862, the Timber Culture Act of 1873, the Desert Land Act of 1877, the Stone and Timber Act of 1878 had all been used by corporations to secure great tracts of valuable land through employing men to homestead them, and the laws themselves were loosely enforced. In successive messages, and by reports of public land commissions, the administration urged the importance of readjusting the land laws for the protection of the public.

400. In the election of 1904 the popularity of President Roosevelt, after his strenuous activity in challenging some of

the strongest tendencies in American life, was put to the test. His political management exhibited the fact that he was trained in the school of the New York politician as well as in the reformer's camp, and he was easily nominated by the Republicans on a platform which endorsed his administration, and made no promise of tariff changes. The Democrats turned to the conservative wing, omitted any reference to silver or the income tax, and nominated judge Alton B. Parker, of New York. The radicals, who favoured William R. Hearst, the well-known newspaper proprietor, who was influential with the masses of large cities, were largely represented in the convention, but unable to poll a third of its vote. Parker accepted the nomination after telegraphing that he regarded the gold standard as irrevocably established. The issue of imperialism had been largely eliminated by the current of events and the anti-trust issue was professed by both parties. In the outcome Roosevelt won by the unprecedented popular plurality of over 2,500,000, and an electoral majority of 196.

407. The state elections of the same period showed that a