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THE STORY OF THE
NONPARTISAN LEAGUE

THE STORY OF THE

A CHAPTER IN AMERICAN EVOLUTION

By
CHARLES EDWARD RUSSELL

Author of

"Business: The Heart of the Nation"
"Stories of the Great Railroads"

HARPER & BROTHERS PUBLISHERS

NEW YORK AND LONDON

THE i 'kv OF Tin: NT.TARTISAN LEAGUE

C •.•vri^!:t. i')2r), l.y H:irry_T & Brothers

I'natCu ,:. the United btaic? of Aaunca

I'L; Jlijl.t ! '>! iy, lyio

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CHAP. PAGE

I. THE BEGINNINGS OF THE GOLDEN NORTHWEST 1

II. How ONE MAN CAME TO WRECK .... 23

III. THE MAGIC OF THE MIXING-HOUSE — WITH

OTHER STRANGE MATTERS 34

IV. PHANTOM SWITCHING, FALSE BALANCES . . 64

V. THE HIGHLY INSTRUCTIVE STORY OF THE " FEED

WHEATS" 76

VI. MAKING A JOKE OF THE BALLOT-BOX ... 95
VH. THE CRUSHING OF THE FARMERS' EXCHANGE . 109

VIII. UNEQUAL FIGHTS ON MANY FIELDS . . . . 123

IX. THE SPINNING OF THE WHEEL OF FORTUNE . 151

X. SOME ADVENTURES IN PHILANTHROPY . . . 171

XI. WHAT CAME OF ONE FARMER'S RUIN . . . 184

XII. THE FIRST VICTORY 203

XIII. "THE FARMERS' LEGISLATURE" 224

XIV. THE LEAGUE AND THE WAR 229

XV. THE FARMERS IN COMPLETE CONTROL . . . 249

XVI. SCHISMS AND INJUNCTIONS 280

XVII. FIGHTING IN THE LAST TRENCH 301

XVIII. THE FAMOUS BANK CASE AT FARGO . . . 309

XIX. REASONABLE CONCLUSIONS 322

INDEX 327

ILLUSTRATIONS

GOVERNOR FRAZIER VISITING NORTH DAKOTA

FARMER AND HIS WIFE Frontispiece

PIONEER NORTH DAKOTA LOG HOUSE .... Facing p. 6
TYPICAL NORTH DAKOTA FARM-HOUSE .... " 24
FOOD LABORATORY OF THE NORTH DAKOTA AGRI-
CULTURAL COLLEGE " CO

MINNEAPOLIS CHAMBER OF COMMERCE BUILDING " 78
STATE EXPERIMENTAL MILL AT THE NORTH DA-
KOTA AGRICULTURAL COLLEGE " 90

COUNTING-ROOM OF THE BANK OF NORTH DAKOTA " 288

LEAGUE MEETING AT BRUSH LAKE, MONTANA . . " 304

THE STORY OF THE
NONPARTISAN LEAGUE

THE STORY OF THE
NONPARTISAN LEAGUE

CHAPTER I

THE BEGINNINGS OF THE GOLDEN
NORTHWEST

ONE night in October, 1919, and I think
it was the 19th of the month, five farm-
ers dined at a restaurant in Washington, D. C.
It was a good enough place, rather noted for
moderate prices and a varied menu, which
was why the farmers chose it. They ordered,
with design, a dinner of staple viands, and, as
it came to table, measured or weighed or
closely estimated each dish; so much of bread,
so much of potatoes, so much of butter, so
much of meat, so much of sugar, and thus to
the end.

With paper and pencil they recorded each
amount and, at current prices at the farm,
the net sum the producer received for each
dish they consumed. When all was done,
they called for their bill. It was $11 .95, ex-
clusive of gratuities.

THE STORY OF THE XONPARTISAN LEAGUE

They made a total of all the items they had
entered as they went along, showing what the
producer had netted from this. It was 84 cents.

A few nights before the five had attended a
meeting of farmers, addressed by a Senator of
the United States,three members of the national
House of Representatives, and an eminent but
migratory statesman out of employment.

These had, with one accord, though in
much variety of enthusiastic phrasing, in-
formed the meeting that the farmer was the
most important man in the country. Every-
thing depended upon him: the prosperity
of the nation, its safety, progress, and great-
ness. In the scheme of modern society, one
speaker had declared, the Farmer was It.
He fed all the rest, for on his skill and labor
they must live; his patriotic services and
sacrifices had enabled the government to
wage and win the Great AVar. Much glory
be to the Farmer! And now it appeared the
nation once more looked to him for deliver-
ance and help. There was underproduction
in our broad land. What was needed was
that every farmer, conscious of his responsi-
bilities and important functions to society,
should go forth and increase production, and
one speaker failed not to adorn his remarks
with that highly original thought about the
beatitude of making two leaves of grass
grow where onlv one had grown before.

BEGINNINGS OF THE NORTHWEST

Pained observation was made that the
response of the audience to these appeals had
not been all that statesmanship could wish.
Undeniably the farmers listened with bored
weariness instead of proper applause to the
eulogies of their greatness and grandeur, and
when all was done a hard-fisted and doubtless
hard-headed agriculturist from Georgia caused
some alarm by asking whether any steps
were to be taken to crown the farmer's efforts
in the increased production line with any
better prices for his product.

Now kindly note. This heretical outgiv-
ing from Georgia, being reported, brought
forth sharp criticism in many quarters. At
the time the cost of living was the highest ever
known in the United States. In the view
of the city populations, this meant that the
farmer was wallowing in ill-gotten wealth;
narratives about farmers that had luxurious
limousines for theater parties and costly run-
abouts for shopping tours were favorite read-
ing; and it was felt that the recipients of all
these blessings were most ungrateful to sug-
gest any greater tribute. Men inquired bit-
terly if the farmers wanted to own everything,
and harassed housewives referred with feeling
to the market price of butter.

And the five that had dined together that
night cut from the press a sheaf of such stories
and comments, pasted these upon a sheet of

THE STORY OF THE XOXPARTISAN LEAGUE

ornamental card and centered all with the
total of 84 cents as the farmer's share of a
restaurant hill of $11.05. Then in mock
heroics they repeated the eloquence where-
with they had been baptized a few nights
before: "You represent the most important
element in human society! Yrou are the sin-
ews of the nation's prosperity! Y7ou perform
the indispensable service!" singsonging it,
and, I grieve to say, mocking the solemn
statesmen. *' At the rate of 84 cents in about
every twelve dollars," added the chorus.

I have no idea that in the succeeding pages
I can remove the fixed belief of the dwellers
in cities that the farmer of America is becom-
ing clog-footed with wealth, but it has oc-
curred to me that a plain record of the tragic
struggles of a large body of American farmers
for bare justice and a chance to live, struggles
extending over a generation, made against
discouraging odds, and still going on, might
have some interest as a human as well as a
social and political document of facts. And
having seen and had some part in most of
these activities, I have set down in the fol-
lowing pages my own observations of what
was really a characteristic American drama.

For a generation after 1880 two human
tides moved in the highways between the
Middle Northwest and the older world to the

BEGINNINGS OF THE NORTHWEST

east. One flowed in, full of hope, keyed to
the struggle for success in the new country.
The other, much smaller but still considerable,
ebbed eastward, beaten, crestfallen, and usu-
ally ruined.

This was unnatural and illogical; there
should have been but the tide flowing in, since
the region was virgin prairie, marvelously fer-
tile, well watered, blessed with a healthful
climate, and now being settled by enlightened
and worthy people; a country smiling with
every promise of wealth and open-armed for
industry and enterprise. Its business, to be
specific, was not one subject to the wrhims,
changing tastes, or even preferences of man-
kind, for it was the world's greatest granary;
it produced in huge quantities Wheat, man's
chiefest, indispensable staple, always in de-
mand, never oversupplied. Yet, after a few
years the records, though so little regarded,
told a melancholy story concerning the region
thus almost incredibly endowed. The farm
mortgages, increasing out of proportion to
the population, were reaching appalling fig-
ures. Newspaper advertising columns some-
times teemed with dismal notices of fore-
closure. The abandoned farm, which should
have been as rare there as the mastodon, was
becoming as common as among the exhausted
hills of New England. In one drive of forty-
six miles in the summer of 1914 I counted

5

THE STORY OF TIIE NOXPARTISAN LEAGUE

seven of them. But abandoned with this
difference, that on each the bank had fore-
closed its mortgage and the fertile untilled
soil now lay there waiting for a new occupant,
a new mortgage, and a new struggle against
overwhelming odds.

Overwhelming odds? How can they be
in a country so manifestly and wonderfully
enriched with every advantage?

And here we come upon a series of facts
that most of us do not know or habitually
ignore, and yet facts that if we stop to think
of we shall be of one mind about, for they are
of overshadowing importance to us and all
our affairs.

Farming ought to be the best business in
the world. Truly, as the statesmen said, it
is the most useful, serviceable, necessary.
By means of it the race lives. All other con-
cerns lead back, soon or late, to the plow and
the hands that guide it.

Fanning in the United States, of all farm-
ing, ought to be the most profitable, for no
other nation has such farming resources, with
such consuming millions so close at hand.

Farming in the Middle Northwest ought
to be the best of American farming, because
this endowment there is at its best.

Yet farming, useful, serviceable, necessary,
and all thai, is not a good business. Farm-
ing in the United States does riot reflect the

a

BEGINNINGS OF THE NORTHWEST

natural advantages of soil and situation, and
is, on the whole, a conspicuously bad business.
Farming in the Middle Northwest has been,
all things considered, the worst business of all.

It is the abnormal conditions in the Middle
Northwest that I should dwell on for a mo-
ment, for they are the most remarkable and
least defensible.

The growing of wheat in large quantities
demands of the soil certain salts: potash, ni-
trates, and so on. When the white man came
to it the whole Northwestern country beyond
the Mississippi and east of the Rockies was a
vast, treeless, and almost level plain. For
centuries and up to sixty or seventy years ago
this plain was swept in the autumn with fires
that turned the dried prairie grasses into ashes.

These ashes, accumulating, year after year,
made a black loam, thick, rich, and full of the
salts required for wheat-raising.

The Dakotas, North and South, being
chiefly prairie, stored the richest of these
deposits.

They had, too, another great advantage
for successful farming. Settlement started
with land free or very cheap; therefore the
initial investment was small or nothing.
Most of the land was public, and, for settle-
ment, could be obtained free by homestead
entry.

At first remote, the region was soon brought

THE STORY OF THE NONPARTISAN LEAGUE

to the doors of the rest of the country. Rail-
roads reached it and threaded it up and down.

Observe, therefore, that it produced, with
unequaled liberality, wheat, this indispensable
necessity of mankind, and had ample facili-
ties to get this staple to the busy hives where
men demanded and consumed it. And yet
was not this a good business, but a distinctly
bad, so that thousands of farmers well versed
in their trade failed in the Dakotas and thou-
sands of others were clinging to their acres,
fighting with the desperate resolution of men
in a doubtful battle, undergoing drudging
toil and racking anxieties that they might win
no more than a bare existence.

I cite the facts as I found them and knew
them and as the somber records reveal them.
Dakota means in the Indian language some-
thing bright and attractive. In the bitter
dramas that were being enacted in a thousand
homes there, it came to mean the land of
heartbreaking disappointment. City popu-
lations knew nothing of this and persisted
in a totally different idea of the farming busi-
ness. A\ e in the cities, paying month upon
month increasing prices for flour, or noting
in the newspapers something about the soar-
ing prices of wheat, surely believed that the
farmer must be prospering and all was well.
I'ut while we paid for flour and bread the
prices that made us gasp or groan, foreclosure

BEGINNINGS OF THE NORTHWEST

notices became more and more frequent in
the Northwestern journals and the farmer
saw his chances for success always dwindling
before him.

Yet at any time (and here was the bitter-
ness of his case) he could trace back the
barrel of flour bought by an Eastern house-
holder, put together the retailer's profit and
the wholesaler's, add in the cost of trans-
porting, the cost of milling, the cost of
hauling the wheat to the mill, clear back to
the day when he started from his farm with
that wheat in his wagon, and see that between
the price paid by the householder and the
money he, the producer, received was a huge
discrepancy beyond all allowances and beyond
all reason. And he saw plainly also that this
discrepancy was what made to him all the
difference; that if at any time he could ob-
tain a fair share of the price paid by the
householder, farming would not be a hand-to-
hand struggle for life, but a business of just
compensations.

Feeling more and more the sting of this
wrong, it was inevitable that he should revolt
against it.

Gradually there had grown up a system of
handling the wheat from the farm to the con-
sumer that involved much machinery, need-
less operations, and stupendous waste. Part
of this wraste was paid for by the consumer;

'1 'I IK STORY OF TIIK NOXPARTISAN LEAGUE

the larger part was the burden of the pro-
ducer and meant to him many things. It
meant the reason for the overthrow of the
manifest purposes of Providence; it meant
why the fertility of the soil was made a worth-
less asset, why he must toil so long and hard
and see other men that never toiled take the
fruits of his dense labor, why some such pros-
pect of toil and always toil to small result was
all he could see for himself and his children.
The outside world never understood his
grievance and is yet unaware of it; but fair-
minded men that will take the trouble to
weigh his complaint will find it founded on
at least one hard, undeniable physical fact,
as bad for society at large as for the farmer.
God made the soil fertile, the farmer's hard
work made it bring forth what the world
wanted, and then other hands and many of
them, having nothing to do with production,
came in and seized the fatness of the tilth.

These hands had in the course of time
perverted and bedeviled what was in itself
one of the simplest of processes. From the
farm to the mill, from the mill to the con-
Miiner, nothing else was involved; for the
purpose of raising wheat was not to give spec-
ulation something to play ducks and drakes
with, but to supply mankind with the bread
by which they lived. Hut the system that
had grown up lined the plain straight road

BEGINNINGS OF THE NORTHWEST

from farmside to dinner-plate with strange
devices for taking toll as the wheat went
along. Commission men in the market cen-
ters juggled it back and forth; "mixing
houses" played tricks with it; upon vast com-
plicated machines like gigantic wheels of
fortune men gambled in it; railroads levied
on it excessive charges for transporting it;
a line of middlemen passed it superfluously
one to another, each taking a heaping handful
as it pursued the tortuous path prepared for
it — until at last, a mere specter of the portly
bushel it had started, it came to table.

"The farmer raised a bushel and got paid
for a peck; the consumer received a peck
and paid for a bushel."

As is usually true of such conditions, the
strength of the system lay in the great profits
it reaped for its beneficiaries. Colossal fort-
unes were made on the grain exchanges; the
power they created spread wide and fortified
the system, and the fame of them and the
alluring chance of others like them fired men's
imaginations and tore up moral codes. There
was never a system of ethics that could stand
the strain of a great nugget of gold. It was
the same way about the grain business. A
profit of $100,000 on an investment of a fourth
of that amount was easily possible, as we
shall see hereafter, in a few days' operation

of a reliable "mixing-house"; a "wash sule"

11

Till-: STORY OF THE XOXPARTISAN LEAGUE

of 20,000 bushels of grain between two
brandies of the same concern was made in
halt' a second willi a stroke of a pencil and
meant $-200 of commissions. It is plain the
door was wide open for abuses and in they
came, a plenteous throng. Nothing else could
have been expected.

Another great bulwark of the system, as
finally it came to be, was the force of tradition
and habit. Time seems to sanctify some of
the rottenest of business expedients, and
sanctification breeds new ones from the origi-
nals. "Of course, it isn't exactly on the
square," grain-dealers have said to me when
discussing some practice in their way of trade,
"but that is what everybody does and always
has done, and you couldn't change it." Even
more than that, under the evil witchcraft
of profits, men came, as usual, to confuse
privilege with right and to contend in the
manner of olFended virtue against any attempt
to change the system that gave them their
perquisites, however immoral that system
might be shown to be. These things are
familiar enough to every person that with
any attention has read history. They were
not different in the case of the grain business.
Profits there, as in other fields of gainful
enterprise, produced their own moral stand-
ards; and it. only remains to remind our-
selves that the hardihood and fierceness with

BEGINNINGS OF THE NORTHWEST

which these are upheld are always in ratio to
the size of the profits.

For these reasons, the grain exchange came
to be in the mind of the Northwestern farmer
the symbol of all the wrongs that oppressed
him. Grain exchanges were the hives of
the commission men, elevator firms, manipu-
lators, speculators, millers, and the rest that
in his opinion had formed a combination to
take away his money. He saw his wheat
go into the exchange a heaping bushel and
come out a sorry two pecks and the sight filled
him with a rage as blind as the cupidity of
the grain broker. There were three of these
institutions that he chiefly cursed — the Chicago
Board of Trade, the Duluth Board of Trade,
and the Minneapolis Chamber of Commerce.
But the greatest of these was the Minne-
apolis Chamber of Commerce, which to the
grain grower combined all the evils of all the
rest.

Minneapolis, which is in many ways one
of the most remarkable and admirable cities
of the world, is also the world's greatest grain
market. There is a tradition on the Cham-
ber of Commerce that it has been raised to
this eminence by the merits of its commission
men, but this is an amiable fallacy. It was
made a great grain mart by the Falls of St.
Anthony in the Mississippi River at its front
door, and by the prairie fires that the care-

Till: STORY OF THE NONPARTISAN LEAGUE

free red man used to start every fall. One
produced the power wherewith to grind wheat,
and the other the wheat to be ground, and the
two erected the market-place that now over-
shadows the grain-growing world.

As soon as white men came to this part
of the world and began to plant it they began
also to make use of the enormous motive
power of the Falls. After a few years a com-
pany of them bought that power outright.
This was the initial error from which have
come mischiefs uncountable. The Falls were
in a navigable stream, the stream wras the
public's highway, the whole of the stream
and the attributes thereof should have re-
mained a public possession, and if they had
so remained the grain story of the Northwest
would have been very different and infinitely
more cheerful.

The new owners of the public's water-power
were flour-millers. They built mills at the
Falls, the mills attracted wheat to Minne-
apolis, the burned-over prairies began to
increase greatly the wheat output, the for-
tunate owners of the public water-power made
exceedingly good profits and built more mills,
and the road for wheat to Minneapolis was
fixed and established.

When this was plain enough, the flour
manufacturers there founded the Minne-
apolis Millers' Association, the purpose of

BEGINNINGS OF THE NORTHWEST

which was to establish uniform buying prices
for wheat and prevent the loss that followed
when one mill bid against another for it.
In 1881 the name of this association was
changed to the Minneapolis Chamber of
Commerce, but it continued to be an organi-
zation chiefly of millers and milling interests
and the affiliated elevator enterprises.

In 1883 it applied to the legislature and
secured a law that conferred upon it remark-
able and even amazing powers.

The Minneapolis Chamber of Commerce,
by this act, was elevated to the dignity and
authority of a trial court,1 although remain-
ing within the control and observation of its
own members. For instance, in arbitrating
differences among these members or between
a member and an outsider, it was authorized
to subpoena witnesses, and swear them ex-
actly as in a court of the state, and the awards
of its tribunal in such cases, when filed with
the clerk of the district court, had all the valid-
ity and significance of findings by the court
itself. Yet all the proceedings of this ex-
traordinary tribunal were conducted in secret;
neither side was represented by counsel and
nothing concerning the trial except the award
was allowed to reach even the district court.

In other words, the legislature had erected
a new judicial tribunal, affecting the public

1 See General Laws of Minnesota, 1883, Chapter 138.
15

THE STORY OF THE NONPARTISAN LEAGUE

interests, but immune from public super-
vision, and had clothed it with the attributes
of the Star Chamber.

Whatever may be alleged in defense of such
an anomaly upon this soil, there can be no
question of its immediate effects. The con-
trol of the Chamber of Commerce was in the
hands of the milling interests of Minneap-
olis; the law now gave into the compass of
this control an unlimited power to discipline
(or overawe) all the other members. With-
out chance of appeal or redress, any broker
on the Minneapolis market that offended the
controlling influences could be dismissed from
the Chamber and ruined in his business.1
The brokers, or commission men, functioned
chiefly to buy wheat for the mills. It was
the first aim of the mills to get that wheat
as cheaply as possible. Laying aside all the
other trouble-making conditions we have no-
ticed, and are still to notice, here was clash
inevitable between the producers and a cham-

'• (('ut-ftion. — Those court trials, do you have an .irtu.al judge in the
seat.-?

An.'tirr. No; that is provided for under the statutes.

V Of this Mate?

A. \ es. .sir. If you will look in the book of rules you will be inter-
ested at lea -4 to see t he statute relating to the ( 'Slumber of Commerce.

(J.- I understand all these trials, imposing the penalty, execution
i if the judgment are all i» hind cl<>.-ed doors and never appear in the
public paper-, at all.
.1 . Yes, sir

/.'•/•"•<• n committ" rif thf II oust- of Reprrsrntatirex, Legislature of
.\firini-.«»t'i. inmtigatinij y,,i,i i-srhnnycf. Testimony of J . J . McHinjh,
^'•cri-ttiry of the Minneapolis ('hnm^rr of Commerce.

BEGINNINGS OF THE NORTHWEST

her so constituted, so controlled, and so armed
with absolute and irresponsible authority.1

Meanwhile, also, the great profits of the
milling interests were accruing as a financial
force. The millers owned, organized, or domi-
nated banks. Minneapolis became hardly
less of a money than of a wheat market.
Capital in great quantities was required to
develop and finance the country that was
always being settled toward the northwest,
and again every fall to perform the indispen-
sable function that is called "moving the
crops." Minneapolis was the natural pivot
for all these operations. In its rapidly de-
veloping financial institutions hundreds of
country banks through the Northwest had
their depositories when money was in light
demand and their well-springs of currency
wrhen the crops were to be moved and the
local elevators must have money literally in
stacks to pay for the wheat they were buying.

This condition produced a concentration
of power no less than of capital; it always
does. The country banks were to a certain
extent at the mercy of the great Minneap-
olis bank, as in turn the farmer and small-
town tradesman wrere at the mercy of the
country bank. The great Minneapolis bank

1 The witness quoted above admitted that any member that paid
prices for grain not based on the Minneapolis market could be ex-
pelled from the Chamber, and without redress.

17

THE STORY OF THE NONPARTISAN LEAGUE

could embarrass or ruin the small country
bank by shutting off its currency supplies
or refusing deposits. The small country
bank could ruin the farmer or tradesman by
shutting off his credit. Over the farmer in
particular the local bank held a menace usu-
ally found enough to cow the most rebellious.
It held the mortgages on his farm and often
on everything else he owned, and chattel
slavery itself could hardly have provided a
more perfect subjection.

To placate a financial sovereignty like this
was a natural impulse. It will be seen at
once that no commands, instructions, nor
even, in many cases, direct intimations,
were needed; a general understanding that
the genius sitting above, witli fingers on the
pipe of money supply, desired this to be done
or thought something else would be good for
business — this was usually enough, and could
hardly have been otherwise.

But tlu" one great nerve center of the busi-
IH'-S of Minneapolis was the milling industry.
Mill had been added to mill until the daily
output readied ^5,000 barrels, 40.000 barrels,
<>0,000 barrels, 80,000 barrels.1 The long
trains of freight-cars, on one side bringing
the wheat and on the other side bearing away

: T !:<•!••• HP- twenty-five flour i;r!K with a totri! daily capacity of
SII.H,<P barrel,, in l!)1.1 Mimi.'apulis produce'] Is. *,)*, SOI barrels of
t!.>ur. -::','\ t-i l>c 'fju.-o1 to s. nun. (mo. ooo loaves of bread or 80 loaves
for cadi inhabitant of the L iiitcd Slates.

IS

BEGINNINGS OF THE NORTHWEST

the flour, stuck out from the city on both
sides like the fingers of gigantic hands. All
the world looked to Minneapolis for flour
and had never known anywhere the develop-
ment of any industry to the like solid pro-
portions in the like space of time. But the
wealth the Minneapolis milling interests gath-
ered so fast spelled, of course, power, and,
as always happens, the new power that lay
in additional wealth meant more wealth to
gain more power to gain more wealth. And
as the milling industry overshadowed all
others in Minneapolis, it was inevitable, also,
that the milling industry should dominate
the great banks of the city, which in turn
dominated the small banks of the country,
which in turn swayed so portentous a power
over the farmer and tradesman. If the long
freight trains gathering in wheat and carry-
ing forth flour were the fingers of the giant,
the mind that moved and commanded all sat
in the Chamber of Commerce and the banks
were its agents and servitors. For the same
men that owned the milling interests owned
controlling shares in the banks or dominated
the directorates thereof.

The natural concern of the milling inter-
ests was to keep down the price of wheat.

There was also developed in the Western
country at about the same time a third power
even greater than these. Hereafter men will

19

THE STORY OF THE NOXPARTISAN LEAGUE

never believe the actual proportions to which
railroad influence attained in the politics and
government of the West; only those that
have taken part in the long, bitter, savage,
and usually hopeless struggle against this
huge power can have any true idea of what
it was — and is. To men that dwell in settled
regions where the corporation has been awed
out of politics, the true story would seem like
(laming fiction; to the men of the West that
hungered and thirsted to be free it was rigid
fact and the absorbing interest of their lives.
One may say without the least exaggeration
that for many years in most of the Western
states popular government was abolished and
there was no ultimate authority but the will
of a railroad company. Every such company
maintained a political department in charge
of men that had developed political manipu-
lation beyond any known limits elsewhere,
for they had made of it expert and exhaust-
ive study. Having seen these gifted men at
work in their own field and the ablest men
of Tammany Hall at work in theirs, I unhesi-
tatingly give the palm for excellence to the
politician of the Western railroad. Compared
with his vast and marvelous operations the
work of the Sheehans and Crokers seems but
poor and crude.

It has been urged in defense of these con-
ditions that the railroads needed in the bein-

BEGINNINGS OF THE NORTHWEST

ning a great deal of legislative favor, and,
being exposed to legislative raids, they organ-
ized for political control that they might save
their lives. Observers of man and his com-
plex ways will not ponder much over this
theory, knowing something of the magical
fascination that lies in great power. The
men that swayed the Western railroad com-
panies a few years ago were clothed with
a power literally greater than that of any
modern monarch, and that fact is enough to
explain all.

The great power of the railroads in the
Northwest came before long to be closely
interwoven with the power of the Chamber
of Commerce and the power of the banks.
There was first the natural community of
interest growing out of the fact that the
millers had every day so many hundreds of
cars to be hauled; or, in other words, con-
trolled such great quantities of fat business.
But more than this, the dominating influences
in the mills, the Chamber of Commerce, the
banks, and the railroads became after some
years practically the same. The railroads
came to be owned or directed by two or
three groups of New York financiers whose
banks were not only in direct touch with the
banks of Minneapolis, but exercised over them
an always increasing influence as the owner-
ship of all these institutions, whether rail-
si

THE STORY OF THE XOXPARTISAX LEAGUE

roads, mills, banks, or elevator companies,
constantly narrowed down to fewer and fewer
hands. There was, moreover, this fact be-
coming more apparent every day, that if the
small country bank was dependent upon the
great Minneapolis bank, the great Minneapolis
bank was dependent hardly less upon the
greater bank of New York.

In the presence of all these tremendous
powers the farmer of North Dakota seemed
like the smallest midget to be filliped about
by the thumb nails of giants. Instead of
frightening him, the great and almost comi-
cal disproportion between himself and the
influences he must fight if he was to win free,
seemed, in some cases, at least, to stimulate
him. It was Jack the Giant-killer in real life;
Ulysses defying a new race of Cyclops. A
hard-handed farmer in big boots and soiled
overalls is not just the typical figure of ro-
mance; but if you will follow now the details
of his fighting I think you will find him as
chivalric as those that went up the slopes of
Bunker Hill and possessed of essentially the
same spirit.

HOW ONE MAN CAME TO WRECK

I CAN show what the resulting conditions
meant for the average farmer by citing
one example of many that fell under my
observation.

About 1899 a young man from my own
state of Iowa joined the tide that flowed
toward North Dakota, and pre-empted 160
acres west of the Missouri. That is to say,
he got the land for nothing on condition
that he should build a house on it and live in
that house a year. He was more fortunate
than many of his fellow-settlers because he
had a little money. lie had saved about
$400, which, in his calculations, was enough
to give him a start — on free land. He had
also a wife, newly wedded. Both had been
reared on farms; they knew the farming
business from end to end, or thought they
knew it. John Evans, the husband, had even
taken a course at an agricultural school and
could analyze soils and do the rest of the

college stunts.

2-3

THE STORY OF THE NONPARTISAN LEAGUE

He bought four horses and two plows.
Then he found his money was gone. He was
already in debt for what passed for a house
he had built on his land. As soon as possible,
therefore, he prepared to put a mortgage on
his 160 acres and approached the bank in
the skeleton of a town five miles away. He
had informed himself that the legal rate of
interest in the state of North Dakota was
12 per cent., and he thought that about $800
at that rate would fix him so he could get his
seed and the rest of the machinery he needed.
To his disgust, he found that while the mort-
gage he was invited to sign up specified 12
per cent, truly enough, it was dated six months
back; also that the genial banker demanded
a bonus of $50 for executing the loan. This,
with the $48 pretended to be due for six
months' interest, would leave him with $702
cash in hand, although his mortgage obli-
gated him to repay $800 in five years, and
every six months the interest thereon.

Vehement was the protest he made to the
banker. That experienced person was bland
but firm, and threw into his expressions a
certain note of menace not comforting to
John Evans's anxious ear.

;'You see, Mr. Evans, it isn't my money.
If it were I should be glad to let you have
it at only nominal rates. But this is money
sent to me by Eastern investors and they

24

HOW ONE MAN CAME TO WRECK

insist upon these terms. They get them
everywhere else in North Dakota, so they de-
mand them of me. That is the reason for
predating the contract. That money has
been here six months and my customers in
the East demand that interest on the money
they advance shall begin from the time they
send it. But of course you are not obliged
to accept these terms, Mr. Evans. If you
think you can do better somewhere else, go
and try it. There's a bank over at Medusa
you might try."

It was ten miles off, he told me, but he was
so angered that he resolved to attempt
Medusa. So the next day he drove off in
the other direction and interviewed another
bland banker, to about the same result.

''These are the prevailing rates for money,"
he was told. "The risk is so great that mon-
eyed men are unwilling to accept it without
reasonable compensation."

"But I have one hundred and sixty acres
of the best land in the valley," said Evans,
"and if I run away the land can't."

:'You forget the heavy expenses and the
delays of foreclosure," said the banker man,
coldly. "Besides, very few of these fore-
closed farms realize the principal. But we
go here on the basis of take it or leave it.
We don't compel any man to make a loan he
doesn't approve of."

25

THE STORY OF THE NONPARTISAN LEAGUE

Evans went out and took counsel with a
farmer whose team he saw hitched to the
railing in front of the town's one store. He
ended by signing up the contract, but he had
to wait several days for his money.

This was early in March. He now got his
seed and the rest of the machinery he needed;
also some pigs to supplement the two cows
and the chickens he already had. The land
was in good condition; his plowing had been
carefully done. He seeded late in April and a
month after was hopeful of a good yield.

Meantime a baby had come and the doc-
tor's bill and other expenses, with food sup-
plies and fodder for his live stock, had begun
to eat into what the seed and machinery had
left of his $702. When the wheat was cut
and stacked his money was about gone.

Interest day was close by and he saw that
he would never be able to meet it and get
through his tnreshing, so he approached the
banker about a loan on the horses and harness.

The banker demurred. The bank did not
do that kind of business; first-class loans on
unencumbered real estate was its line. But
he thought he knew where the loan could be
effected and sent him to what was called (by
the farmersj a money shark in the next town.
The shark made the loan easily enough—
at 1C per cent, and an undervaluation of all
the chattels.

HOW ONE MAN CAME TO WRECK

He now paid the semiannual interest on
the $800, nominally 12 per cent, on that
amount and really 14 per cent, on the $702
that he had received. The threshers came
and must be fed as well as paid for, and he
was again in sight of the lee shore when at
last he was able to load his wagon with wheat
and start for the nearest elevator. It was
in the little station town of Jason and
bore on its brown front white letters that
read, " Arctic Elevator Company."

The elevator man came out, thrust a prac-
ticed hand into the wheat, and flipped off, as
if by magic, the formula of examination.

"Pretty badly shriveled, ain't it?" he said.
" No. 4 is the best I can do for you on that."

"No. 4 nothing!" shouted Evans, hotly.
" That's as good No. 1 wheat as you ever
saw in your life. Just look at it! Plump,
hard, smooth, good color — if that isn't No. 1
there never was any."

"No. 4," said the man. "That's what
they hold me down to in Minneapolis. You
know if I overgrade this stuff they come back
on me. No. 4 is what it will grade for down
there and No. 4 is what it will have to be here."

'You're crazy!" said Evans. ;'You never
saw better wheat!"

" Suit yourself," said the man, easily. " You
know there's another elevator over there at
Brownsville. Why don't you try that?"

27

THE STORY OF THE XOXPARTISAN LEAGUE

Evans told me he had all the time a feeling
that it was useless, but he was so vexed that
he drove home without selling his wheat and
the next day piloted the same load to Browns-
ville. He said that as he left the precincts
of the Jason elevator he saw through the
window the manager at the telephone, but
did not until later ascribe any significance
to that fact.

The next day he drove six miles to Browns-
ville, where the equally large and imposing
elevator bore on its side the words, "Farmers'
Grain Company," which struck him with a
note of cheer. If farmers were in the grain
business they would surely treat other farm-
ers fairly.

The elevator man came out and there fol-
lowed the same play of sampling the load
and rolling wheat about in the hands.

"No. 4," says the elevator man, at the
conclusion of this performance. ''You see
there is so much shriveled wheat in it and so
much cockle."

Evans protested as before. "Why. you're
lucky to get that!" said the elevator man.
"I doubt if it will make Xo. 4 on the Minne-
sota inspection. It will probably go in as
Rejected and then I'll get hell."

Evans inquired what was the price for No.
4. The man took down a Minneapolis mar-
ket report. "It was selling at sixty-eight

HOW ONE MAN CAME TO WRECK

yesterday. And then there is the freight off
and the commission — sixty -three cents here.'*

"I don't see how I can take that," said
Evans. "It won't pay me for the seed and
hired labor."

"Well, the Creusa people have an elevator
over at Cowgill. You might see what you
can do over there."

Fifteen miles away that was. Evans said
he saw he was in the trap and concluded he
might as well surrender.

"But it will be three pounds off for dock-
age," said the elevator man.

"Rot!" said Evans. "There ain't three
pounds of dirt in the whole load."

:'Take it or leave it," said the elevator man,
"but you'll have to be quick. I see three
other loads coming."

So the wheat went upon the scales to be
weighed and the next shock Evans received
was when the weighing ticket was handed to
him. It showed the load to be seven bushels
short of his own figures.

The next load he took on a venture to
Brownsville, where the Creusa Elevator
loomed large across the prairie, and was like-
wise by name expressly dedicated to the farm-
ers. And here the suave manager attempted
to grade the wheat as Rejected and allowed
himself as a concession to accept it as No. 4,
with three pounds off for dockage.

29

TIIK STORY OF THE XOXPARTISAX LEAGUE

When Evans got home he did some figur-
ing and the results were not exhilarating. He
had planted 140 acres in wheat, which had
threshed out thirteen bushels to the acre.
At the prices the elevator men were willing
to let him have for this he stood to receive
$1,134 for his crop. Against that he had to
set down for the next twelve months the inter-
est charges he must meet, the cost of living,
of help, of feed, of repairs, of lumber for fenc-
ing and cattle shelters, of seed; and without
allowing anything for the new machinery
he knew he must have, or for repairs on the
old, anything for doctor's bills or even for
shoes for himself or a hat for the wife, the
total of these items was more than $1,200.

He saw that without some such good fort-
une as would amount to a prodigy he was
beaten at the game, but after the manner
of his kind held on with the idea that luck
would change. The next year's crop might
be a bumper or prices might soar. Mean-
time, on the advice of some of his neighbors,
what was left of his wheat he sent to Minne-
apolis to be sold on commission; and, visiting
the loan shark again, put a chattel mortgage
on his machinery, lie was astounded to
find that such wheat as the local elevator men
had graded as Xo. 4 was now graded at
Minneapolis partly as Xo. 2 and partly as
"Xo Grade on account of moisture," when

HOW ONE MAN CAME TO WRECK

he was sure there was no moisture in it when
it left him. "No Grade" wheat had to take
its chances to be sold on sample. When he
had completed this chapter of his experience
he found that he had a smaller return than for
the wheat he sold outright to the elevator
men.

He now broke the remaining twenty acres
of his farm and the next year seeded it with
the rest. There was too much dry weather
that summer and he made an average of only
nine bushels to the acre instead of thirteen.
The yield generally through the country was
smaller than the previous year, but the farm-
ers consoled themselves with the prospect
of better prices. Instead of being better the
market was worse.

With the utmost difficulty he made the
September interest on his mortgage. The
following March he defaulted on it. The
bank began foreclosure. Then he lost suc-
cessively his team, harness, and machines
to the loan shark, and the following winter
he was working for wages on a ranch in
Montana and the wife had gone back to Iowa.

But before he was thus ignominiously
driven from the field he learned two or three
facts that enlightened him greatly as to the
causes of his defeat. He learned, for instance,
that the "Arctic Elevator Company" of Jason
and the "Farmers' Grain Company" of

31

THE STORY OF THE NONPARTISAN LEAGUE

Brownsville and the "Creusa Farmers' Ele-
vator Company" of Cowgill were all owned
by the same persons in Minneapolis. He
learned that while he suffered a loss of three
pounds in a bushel for dockage all the foreign
material taken from his wheat had value and
the elevator owners calmly absorbed this
value for themselves. And he learned that
while this was taken from him without com-
pensation, he had nevertheless paid freight
on it to Minneapolis, because the deduction
for freight was assessed upon his full load,
dockage and all. And he learned to be more
than ever suspicious concerning the scales
upon which his wheat had been weighed.

Also, one day long after he had been de-
feated, and when on the farm where he had
expended so much labor and money and lost
hope another man was struggling with the
like conditions, he fell upon a bulletin issued
by the North Dakota State Agricultural
College, giving the results of scientific experi-
mentation with wheat culture. And he read
there that while that year the North Dakota
farmers had received an average of 72 cents
a bushel for their wheat, the average cost
of producing a bushel of wheat in that state
that year had been 75 cents. And lie saw
that the game was hopeless from the begin-
ning, lie perceived that the 11 per cent,
interest he had paid on his money \vas a

HOW ONE MAN CAME TO WRECK

tragic absurdity because the land did not
and could not produce 14 per cent. When
I saw him, years after all these things had
happened, he had still preserved the glowing
advertisement that first drew his attention
to North Dakota. It was of a land agent
and held out a marvelous lure. "I think the
idea is to keep the soil under cultivation,"
he said, "but make sure that nobody gets
any of the profits outside of the Chamber of
Commerce." He was voicing the growing con-
viction of hundreds of thousands of farmers
facing irreducible facts.

CHAPTER III

THE MAGIC OF THE MIXIXG-IIOUSE WITH

OTHER STRANGE MATTERS

IF he continued in after years to follow
this subject, he must have found much
to enlighten him as to why he was reduced
to be a ranch-hand and his wife to be a wait-
ress in a country hotel.

For instance, he would have found that in
1913 a bill was introduced in the North
Dakota legislature to bring down the legal
rate of interest from H per cent., which it
had been for many years, to the modest
figure of 10 per cent. This bill was referred
(with rare wisdom) to a committee composed
of bankers, lawyers, and merchants. They
killed it. There was an outcry and at the
next session the reduction was actually made
—on paper. The legal rate became lO per
cent., but the law was so adroitly worded
that loans were still made at K\ 14, and even
higher rates. The redress of a borrower that
paid more than 10 per cent, was, according
to this masterpiece of lawmaking, a suit to

MAGIC OF THE MIXING-HOUSE

recover. But the suit must be brought
usually against the local bank to whose favor
the farmer must look for his other money
advances and to which he must go to get his
cash when he had sold his wheat. It was
about the last institution in the world with
which he would wish to have a legal fight.

There were also other subterfuges. The
new law was a jest. I have much under-
stated the facts about it. In 1916, after it
had been in operation a full year, Mr. John
Skelton Williams, National Comptroller of
the Currency and therefore an unquestionable
authority, reported that he found 69 of the 150
national banks in North Dakota to be charg-
ing 12 per cent, or more on their farm loans.

"About a dozen banks in North Dakota,"
he said, "reported loans aggregating from
$1,000 to $8,000 at rates ranging from 15 to
24 per cent.," and it appeared from his report
that in some instances from 28 to 48 per
cent, was charged for small loans.

John Evans might also have read with
profit the case of Adolph Sundahl of James-
town, North Dakota, and learned much
from that as to laws and their administration
when the government is possessed in behalf
of interlocked corporations.

Mr. Sundahl was a farmer like Evans.
He borrowed $300 on which he must pay an
annual interest charge of $40 . 90. He figured

•1 35

THE STORY OF THE XOXPARTISAN LEAGUE

that this was not 10 per cent, as the new law
said, nor 12, as the old law allowed, but
between 13 and 14, and clearly illegal. He
sued, therefore, taking advantage of the
blessed privilege allowed him by the legisla-
ture, and recovered in the lower court.

The money- lender appealed and the supreme
court reversed the finding below and gave
judgment to the money-lender on this ground:

Interest on $300 at 12 per cent, is $36,
and since the law would allow the bank to
deduct this (in advance) the bank could be
construed as lending him (Sundahl) this
much more ($36) simply because it did not
take interest in advance.

Interest on $36 at 12 per cent, is $4.32;
interest on this at 12 per cent, is 52 cents,
and interest on 52 cents is 6 cents, and the
court sustained the banker in extorting this
interest.

He would also learn with interest, but
probably without surprise, that in these con-
ditions farm mortgages in North Dakota
totaled $310,000,000, and were increasing
so rapidly that wise men were uneasy about
the figures. And he would have read with
especial interest the testimony of Olaf Knutson
that under the law reducing interest to 10
per cent, he went to his banker with a first
mortgage on his farm, and the terms the Banker
allowed were 10 per cent, interest and lO per

MAGIC OF THE MIXING-HOUSE

cent, discount on the face of the loan. Also
that when he tried to borrow $80 on his four
horses, two wagons, and harness the loan
agent demurred on the ground that the
security was not enough ; so to raise the money
he had to sell one of his teams for $400.

Also, if in that first year Evans had followed
all of his wheat from the side-track at his
station to the mill that made flour of it he
would have found still more enlightenment.

Take, for instance, the grain that he sent
to Minneapolis to be sold on commission.
It traveled thither by rail and the first charge
that was made against it was the freightage.
The railroad company that hauled it had
received from the people of the United States
such rich land grants that their value more
than paid for the building of the road, which
became then virtually free gifts from the
nation. Next, the company had issued stocks
and bonds upon this gift, and on these stocks
and bonds, which represented no investment
and were constantly increasing in volume,
it was paying dividends and interest. To
secure the money to pay these dividends and
interest on a capitalization that for the most
part represented no investment, but only
the people's gifts, the company arranged its
freight rates so as to obtain the largest possible
returns and without the least regard to the
service rendered or to its cost. Utterly un-

37

THE STORY OF THE NONPARTISAN LEAGUE

just, untruthful, and sometimes illegal or
criminal devices were used to augment this
revenue; the pressure of the always-increasing
capitalization left no other course open to
the managers, no matter how good men they
might otherwise be. They, too, had inheri-
ted a system and a machine to which they
were as much the appendages as the whistle
is an appendage of a locomotive and with
which they could do nothing except go along
and move up the rates as the capitalization
soared.

For these reasons the freight charges on
that shipment of wheat were exorbitant and
absurd. From Jason to Minneapolis, they
were, roughly speaking, something like five
cents1 a bushel more than a Canadian grain-
grower would have paid for wheat hauled the
same distance.

But the wheat arrived in Minneapolis and
stood one morning on a side-track. An in-
spector of the Minnesota State Warehouse
Commission now came to examine and grade
it. He carried with him an implement re-
sembling a big tin dart. This he stuck into
a corner of one car, clicked a spring, and
brought up some wheat. He thought he
saw moisture in the grain and decided it to

1 Taking as a basis the average wheat production of a North
Dakota farm, a toll of five cents a bushel on it.s produce would
amount, in twenty-one years, at compound interest, to $^0,000.

MAGIC OF THE MIXING-HOUSE

be "No Grade on account of moisture."1
He had a great many cars to inspect that
morning, and less than half enough time in
which to inspect them.

Doe & Company, the commission firm to
which the wheat had been sent, now took
samples of it, put them into neat little tin
pans, and the next morning early sent them
to the Chamber of Commerce to be displayed.

At 10 A.M. the gong sounds for the begin-
ning of trading on the Chamber. Five minutes
before ten an able young man representing
the Tidewater Elevator Company had been
along the tables, taking note of the good wheat
displayed there, and the instant the gong went
he bought the Evans shipment on sample
at five cents below the market.

1 No Grade is good wheat, except that it is said to have a little too
much moisture. It is often as good as No. 1 or No. 2, and would
so grade if it were drier. Being graded "No Grade" means it must
go (by sample) on the table at the Chamber of Commerce and be
sold for whatever is bid for it. If there were nothing else, this
manifest injustice would be enough to breed revolt in any
American community.

Rejected Grade means "dirty or smutty or moldy, or having other
grains in it to the extent that it cannot be graded No. 3 or No. 4,"
and so it is rejected altogether. As noted elsewhere, the other grains
when extracted are almost as valuable as wheat.

It may not be necessary, but can do no harm to explain to the un-
initiated the basis for and importance of these gradings. As we have
seen, the farmer's price is determined upon them. "No. 1 Hard"
means wheat of a rarely fine quality, hard and clear, of a certain
flintlike appearance and definite color, standing at the top of the
market. Next below is No. 1 Northern, No. 2, No. 3, No. 4, accord-
ing to the appearance and weight of the bushel; followed by Re-
jected and No Grade. These were the grades in use in the wheat
market for more than a generation, though discarded now. Between
each grade there was ordinarily a difference in price of from three
to fifteen cents a bushel.

39

THE STORY OF THE NONPARTISAN LEAGUE

One cent a bushel was now assessed against
the wheat for this sale. For a reason that
Evans never knew and few suspected, the
able young man that represented Doe & Com-
pany on the floor was quite willing to sell
the wheat below the market. It was because
Doe & Company were also the owners of the
Tidewater Elevator Company. The sale,
therefore, was made from themselves to them-
selves, but the cent a bushel commission
was assessed, nevertheless.

The Tidewater Elevator Company now
sold the wheat at an advance of one and one-
half cents a bushel to the Basota Grain Com-
pany, performing no other service to society
than what might be involved in making three
marks with a lead pencil.

The Basota Grain Company sold it to the
Medicus Terminal Elevator Company at an
advance of two cents a bushel. Same ser-
vice, same value, same result.

The Medicus Terminal Elevator Company
sent it to its mixing-house, where it presently
underwent strange transformations.

If Evans could have pursued the matter
far enough he would have found that the
Basota Grain Company and the Medicus
Terminal Elevator Company were likewise
owned by Doc & Company, and that each
of these sales also had been from themselves
to themselves, the right hand of the institu-

40

MAGIC OF THE MIXING-HOUSE

tion not knowing what the left was doing,
but meanwhile making sure of the one cent
a bushel commission added to the price.

Lest I shall be thought extravagant or un-
fair about this I will refer to the proceedings
before the Committee on Agriculture of the
House of Representatives, Sixty-third Con-
gress, a hearing on House Bill 14493, pro-
viding for the uniform grading of grain;
testimony of F. B. Wells, a gram operator
of great repute on the Minneapolis Chamber;
connected also with one of the greatest of
the houses there.

Question. — You are the vice-president of the F. II.
Peavey Company?

Answer. — Yes, sir.

Q. — That is a line l elevatcr company?

A. — They are not engaged in the grain business in
any way, shape, or form.

Q.— What is it?

A. — It is a holding company.

Q. — Holding what?

A. — Holding stocks of various grain companies in
Canada.

Q. — What companies do they hold stock in?

A. — A controlling interest in the Globe Elevator Com-
pany of Duluth, all the stock of the Duluth Elevator
Company, and hold 95 per cent, of the Monarch Ele-
vator Company.

Q.— What is that?

1 A "line" elevator is one in a series or chain of elevators having
the same owners and stretched through station after station along
some railroad. A company owning such a chain is called, as here,
a "line" company."

41

THE STORY OF THE NONPARTISAN LEAGUE

A. — Country line on the Northern Pacific and Mil-
waukee. The Duluth is a country line; the houses are
principally on the Great Northern and the Monarch
on the Northern Pacific.

Q. — Any other line elevator companies?

A. — Not in that territory. They have a few elevators
in Nebraska. Then there is the Belt Line Elevator
Company, a terminal located in Superior, and the
Globe Elevator operates terminals in West Superior,
the Peavey Duluth Terminal Elevator Company oper-
ating in Duluth.

Q. — Have you any terminals in Minneapolis?

A. — The Monarch Elevator has a terminal; the Re-
public Elevator.

Q. — How many terminal elevators have you in
Duluth?

A. — Three. Not in Duluth, but at the head of the
lakes, two in Wisconsin and one in Minnesota.

Q. — How many country elevators are owned or con-
trolled by these different companies, in the aggregate?

A. — Do I understand you mean Nebraska also?

Q.— All of them.

A. — In Minnesota we have 64 elevators owned by
the Monarch and Duluth Elevator Companies.

Q. — How many in North Dakota?

A. — About 110 — no, I would say about 104; about
6 in South Dakota.

Q. — Nebraska?

A .—Fifty-five, I think.

Q. — Any in Iowa?

A. — Yes, one.

Q. — In the aggregate, about how many country ele-
vators have you?

A.— About 225 or 230.'

on House Bill 114!)."?, Sixty-third Con^rrvs, Testimony
pp. 4.1>-SS.

MAGIC OF THE MIXING-HOUSE

It appeared also that this same company
had many elevators in Canada, and the leases
and intertwinings between its American sub-
sidiary companies and those in Canada were
so intricate that even Mr. Wells could hardly
explain them.1

Or we will listen next to the indubitable
testimony of G. F. Ewe, connected with the
great Minneapolis grain-house called the Van
Dusen-Harrington Company.2

Question. — The capital stock of the other companies
is owned by the Van Dusen-Harrington Company?

Answer. — Yes, sir.

Q. — Then the National Elevator Company, the Atlas
Elevator Company, Van Dusen & Company, the Star
Elevator Company, the Pioneer Steel Elevator Com-
pany, and the Crescent Elevator Company are sub-
sidiary companies of the Van Dusen?

A. — Yes, sir.

Later the witness added to this list the name
of the Interstate Elevator Company as simi-
larly owned.

lie said that the thus owned National
Elevator Company owned in turn 75 or 80
country elevators (each at a station), in
various parts of the Northwest; the Atlas
Company owned 75 or 80; Van Dusen
Company owned 50 or 60. In a sentence or
two this witness acknowledged the owner-

1 Hearing on House Bill 1449'J, Sixty-third Congress, Testimony,
p. 594. * Ibid., pp. 338, 340.

43

THE STORY OF THE NOXPARTISAN LEAGUE

ship of more than 200 of these line elevators,
but there were other concerns that exceeded
even this number. Incidentally, it was this
kind of ownership that explained Evans's
identical experience at Jason and Browns-
ville, and would seem to justify some of his
suspicion concerning the man at the telephone.
Both of these elevators were owned (under
different names) by the same parent company
in Minneapolis, and of course both had, and
conscientiously worked for, the same object
of getting wheat as cheaply as possible.

Mr. Ewe's testimony revealed some, at
least, of the processes of making money on
the Minneapolis Chamber of Commerce to
be of a delightful simplicity.

Question. — Suppose you had an opportunity right
that day to buy that wheat on the floor from a man
who had consigned it to you from the \Vcst and for
whom you had the right to sell it on commission. You
would make the turn arid get the commission for the
sale and purchase both?

Answer. — Yes, sir.1

Mr. Wella made this a little clearer.

Question. — Mr. Wells, do you think it is proper for
a commission house in the commission business to own
subsidiary companies, terminal elevators, and sell to
themselves grain consigned to them [on commission]?

Answer. — I think so, unless it has absolute instruc-
tions to the contrary. I can see no difference.2

1 H.-aring on H.m>.- P.ill 1 Hi).'!, Sixty-third Contrn-ss. 1
p. 350. : Ibid., p. 5U5.

41

MAGIC OF THE MIXING-HOUSE

Later he repeated that ne could see no
impropriety in these practices.

Mr. Ewe's testimony showed that on a
certain day (October 28th, to wit) the Van
Duseri-Harrington Company had sold 9 cars to
its subsidiary companies, and on another day
had sold 12 cars to the Star Elevator Com-
pany, then 5 more to the same concern, and
then 3 cars to the Pioneer Steel Elevator
Company, making 18 cars sold that day from
itself to itself, or about one-half of its total
sales.1

James Manahan, at that time a Congress-
man-at-large of the state of Minnesota, testi-
fied that the Minnesota House of Representa-
tives had not long before investigated the
subject of grain exchanges and he had been
counsel for the committee conducting the
investigation. He said that while acting in
that capacity he got the sales cards of the
Van Dusen-Harrington Company for one
day only, and found upon them a sale of five
cars to the Pioneer Steel Elevator Company.
He continued :

The next day at the hearing I questioned the manager
and he testified that the Pioneer Steel Elevator was a
subsidiary company which they themselves were oper-
ating under a different name. I showed also by com-
pelling the production on that day of the exact range

1 Roaring on House Bill 14-193, Sixty-third Congress, Testimony,
pp. 402 and 532.

4,5

THE STORY OF THE NONTARTISAN LEAGUE

of prices, minute by minute, for which that grade was
selling in the pit — I showed that according to that
record these five cars were sold at a fraction of a cent —
about half a cent a bushel — less than it ought to have
been sold for to start with. Because each of these five
cars were of the finest wheat that could get to Minne-
apolis, No. 1 Northern, and was sold by this company
to its subsidiary company within seven minutes after
the exchange opened — before anybody else had time
to get away from their tables to see what they could
purchase for their people and to bid for this choice
wheat.

A little later the point arose as to the effect
of these proceedings upon outside millers,
and Mr. Manahan said:

Do the mills down the river get the virgin wheat
from North Dakota for which they arc paying a com-
mission to this Van Dusen-Harrington Company, or
to similar concerns to purchase? No, indeed. \Vhcn the
mills down in the country want to buy wheat, the seller
for the Van Dusen-Harrington Company sells wheat —
or, to put it in the other form, the purchaser from the
Van Dusen-IIarrington Company, re-presenting the
country miller, another man on the floor of the ex-
change, goes to the selling agent of the Pioneer Steel
Elevator, the terminal elevator company, the sub-
sidiary, and buys five carloads of wheat for the miller
down the river, and charges the miller, of course, the
regular commission for so doing.

MR. HAIGEN, member of Congress.- — In that way
they get a double commission, do they not ?

MR. MANAHAN. — Yes, and that wheat that comes out
of the terminal elevator, that goes from the terminal
elevator to the miller down the river, is not the kind

40

MAGIC OF THE MIXING-HOUSE

of wheat that goes into the elevator from North Da-
kota. It is depreciated and doctored wheat.

This is an astonishing statement. What
could Mr. Manahan mean by it? "Doctored
wheat"-— it sounds strange, does it not? So
we turn to the records of the terminal elevators
or "mixing-houses" of Minneapolis in search
of possible information and this is what we
find:

In two years these elevators received 15,-
571,575 bushels of No. 1 Northern wheat,
and shipped out in the same two years 19,-
978,777 bushels of that same grade. That is
to say, they shipped 4,407,202 bushels more of
No. 1 Northern than they received. At the
beginning of the two years they had no No.
1 Northern, so the excess cannot be accounted
for on the theory that it wras wheat left over.
Where did it come from? Wheat is not or-
dinarily planted and reaped in elevator bins.
What then was this mysterious source of pro-
duction? And we find that in the same period
the same elevators received of No. 2 wheat
20,413,584 bushels, and shipped out of that
same grade 22,242,410 bushels, or 1,828,826
bushels more than they received. Where did
all that wheat come from?

And again a record of twelve months of
grain inspections in Minnesota terminal ele-
vators revealed this astounding productivity,
in such institutions:

THE STORY OF THE NONPARTISAN LEAGUE

Rrcrirrd Shipped

Grade of Wheat (Bushel*) (Buthtls)

No. 1 Hard 341,507 1,000,438

No. 1 Northern 10,070,414 16,900,917

No. 2 Northern 7,341,594 3,978,311

No. 3 Spring 1,335,830 444,041

Rejected 256,063 134,471

No Grade 1,335,531 344,823

This seems to throw some light upon the
wand-waving, spell-weaving, incantation, or
whatever it is that makes the high grades multi-
ply so marvelously after their kind, for it shows
that 5,466,372 bushels of wheat went into these
elevators as low grade and came out as high.

In the course of this transformation there
was added to their value from eight to twelve
cents a bushel. If the farmer could have had
this value it would have changed for him the
raising of wheat from an unprofitable to a
profitable business. But the farmer did not
get this value. The owners of the elevators
got it and the spreading knowledge of that
fact could result only in added bitterness in
the farmer's mind. For he had raised that
wheat, it was the product of his toil and his
hard-won acres; and no sophistries could
obscure the fact that if it was No. 1 when it
came out of the elevator, it was No. 1 when
it went in. Yet he had not been paid for No.
1 ; he had been paid for Rejected or No Grade,
away down at the foot of the market list.

Concerning these facts and the wide prev-

4<S

MAGIC OF THE MIXING-HOUSE

alence of the system there can be no doubt.
It has been testified to many times in many
investigations;1 it has never been denied.
We have for it witnesses of unimpeachable
veracity: including bankers.

If there be one league or society of business
men more conservative and careful than an-
other it is the Bankers' Association. Yet in 1906
the North Dakota Bankers' Association, im-
pressed with the growing discontent of the farm-
ers and aware that the prosperity of the state
was the prosperity of its farms, appointed a
committee of five to investigate the farmers'
complaints. The course of its investigations
led the committee to Duluth, where it found
the magic of the " mixing-house" or terminal
elevator rather more highly developed than
even at Minneapolis. It discovered one eleva-
tor that in three months had made this record :

Received Shipped

Grade of Wheat (Bushels) (Bushels)

No. 1 Northern 99,711.40 196,288.30

No. 2 141,455.10 467,764.00

No. 3 272,047.20 213,549.30

No. 4 201.267.20 None

No Grade 116,021 . 10 None

Rejected 59,742 . 30 None

Total 890,245.10 877,512.00

On hand, estimated 12,733.10

890,245.10

1 Sixty-third Congress, hearing before Committee on Rules on II. R.
424; hearing before Senate Committee on Agriculture on McCumber
Grain Grading bill, January, February, April, 190S; before the
Interstate Commerce Commission, etc.

49

THE STORY OF THE NONPARTISAN LEAGUE

According to the market prices current
at the time, the value of this wheat as it was
received at the elevator was .$875,405.66,
and its value when shipped out was $959,-
126 .35. The elevator's profits by the changes
in the grades were $83,720.69— in three
months.

There was also the matter of screenings
to be accounted for. Screenings are the
so-called dirt, the impurities and foreign
substances in the wheat for which the farmer
has already suffered dockage at his local
elevator. On this subject the committee
reported:

The screenings actually taken out of the grain [in
this one instance] averaged three-fourths of a pound to
the bushel. From our knowledge of the dockage taken
at country elevators, and also of that fixed by inspect-
ors at terminal points during the period named, we
believe this dockage of three-quarters of a pound act-
ually taken from the wheat to have been very much
less than that taken from the shipper or farmer. These
screenings sold for about eight dollars a ton. After
the dockage of three-quarters of a pound per bushel
was taken out, the grain was shipped [from the elevator]
as clean grain without any dockage. What an eloquent
story is told by the above figures! 1

This, you will remember, is the testimony
of grave and sagacious bankers and not the

1 Before tho Interstate Commerce! Commission in the Matter of
the Relations of Common Carriers to the (irain Trade, pp. 1001-62.
The testimony at this ln-arini: "•,•;« made a public document: Fifty-
ninth Congress, Second Session, Document *78.

50

MAGIC OF THE MIXING-HOUSE

assertions of demagogues or reckless agitators.
The eloquence of the story to which they
referred is partly contained in the fact that
whereas the farmer that raised this wheat
was docked tv/o or three pounds a bushel
for these screenings, they proved, when act-
ually taken out and weighed, to amount to
no more than three-quarters of a pound.
Also in the other fact that, although these
screenings properly belonged to him, they
were calmly seized by the elevator men and
sold for eight cellars a ton. The committee
further reported on this:

We find that all of the dockage or screenings taken
from the grain has an actual value and believe the
shipper should receive this value. This matter of dock-
age is one that could so easily be remedied, and the
shipper given the benefit of the screenings actually
taken from his grain, that the wonder is the present
unjust custom of not only confiscating the screenings,
but in addition compelling the shipper to pay the
freight on them to the terminal point [such as Minne-
apolis or Duluth] has been allowed to prevail so long.

And as to the point made by Mr. Manahan
in his testimony, the committee said :

We find that the Eastern millers want the grain as it
comes from the farmer, and it is an injustice to the
shipper as to the miller to prevent this, as is now done.
The shipper must accept the inspection rules and cus-
toms which have been forced upon him by the powerful
combination of elevator and railway interests, and the
miller [meaning Eastern miller] must take the grain

5 51

THE STORY OF THE NONPARTISAN LEAGUE

that is offered to him by the "grain trust" so-called,
and not in the condition as to mixing that he wants it.

Coming from such a source, this testimony
as to the "powerful combination" to which
we have before referred may be regarded as
conclusive.

Besides the profits on the changing grain
grades and profits from the sales of screenings,
the elevator had still another source of rev-
enue in these transactions. The committee
noted that there were also

the charges for handling the grain and the proceeds of
the sale of wheat and other grain taken from the
screenings. For we found that all screenings are care-
fully cleaned over and all good grain taken out, and that
the good grain taken from the screenings is shipped out
as screenings in order to avoid inspection and appear-
ing in the amount of grain shipped out of the elevator.

We can now begin to glimpse the profits in-
volved and to understand the power they bred.

In one year the terminal elevators of Duluth
made this record:

Grnde «/ Wheat

No. 1 Hard

Rffnrfd
(liushfls)

5!)9,002

Rhipptil
(Bushels)

648,007

No. 1 Northern
No. 2
No. 3
Reiected. .

1.5,187,014
19,093,454
7,03.5,133
892.241

19,880,137
15,178,999
1,971,355
94,020

No Grade.... .. 2,501,505 408,922

They shipped out 4,748,130 more bushels
of the high grades than they received, and the
source of this addition is counterbalanced

MAGIC OF THE MIXING-HOUSE

by the loss of the low grades. The loss to
the farmers (and profit to the elevators) on
these transformations was more than $400,000.

And I pause to point to the fact that the
great world of bread-eaters derived not a cent's
worth of value or of service from these tricks.
In not one particular was the wheat speeded
to the consumer, bettered for the consumer,
cheapened to the consumer. Only the trick
player and never the community had gain
from these jugglings.

Approximately ten million bushels of wheat
in Minneapolis and Duluth every year were
raised from inferior grades two, three, or four
grades to No. 1 or No. 2.

The farmer was paid for Rejected or No
Grade; the Eastern miller paid for No. 1 or
No. 2. Yet it was largely the same grain.
The farmers still insisted that if the grain
was No. 1 when it went out of that elevator it
was No. 1 when it went in, and of this I have
never been able to learn of any valid denial.

In yet another year the same elevators at
Duluth made this record:

Received Shipped

Grade nf Whe-^ (Bushels) (Buslielt)

No. 1 Hard 90,543 199,528

No. 1 Northern 12,401,897 18,217,789

No. 2 10,295,172 6,723,732

No. 3 2,616,065 283,299

Rejected 2,350,302 314,139

No Grade 2,586,843 256,943

.53

THE STORY OF THE NONPARTISAN LEAGUE

It is evident that 2,000,000 bushels of
Rejected and 2,000,000 bushels of No Grade
and 2,000,000 bushels of No. 3 were trans-
formed into 6,000,000 bushels of No. 1. Did
the elevator do anything to it to change its
quality? Nothing except to dry it, if it was
wet, and to blow the screenings out of it.
Neither of these processes could change its
intrinsic quality. If it was No. 1 when it
went out it was No. 1 when it went in and
the farmers were defrauded on these 6,000,000
bushels of close to $500,000. If it was No. 3
and Rejected when it went in it was No. 3
and Rejected when it went out and the pur-
chasers were defrauded of a like amount.
It was no wonder that in a spirit of biting
irony a witness before the House Committee
cited these facts and then read into the pro-
ceedings an account in a Minneapolis news-
paper of a grocer's boy in that city that had
been sentenced to sixty days in jail for selling
a short-weight peck of apples.

The report of W. E. Thompson, chief clerk
of the Minnesota Railroad and Warehouse
Commission, contains a table showing the
amounts of grain received by all the public
terminal elevators in Minneapolis for the year
ending August 31, 1911. From this it appears
that of No. 1 Hard these elevators had re-
ceived in the year 586,500 bushels, had
shipped out 276,484 bushels, and had nothing

54

MAGIC OF THE MIXING-HOUSE

left on hand. Of No. 1 Northern they had
received 15,571,575 bushels, had shipped out
19,976,777 bushels, and had 114,454 bushels
on hand. Of No. 2 they had received
20,413,584 bushels, had shipped out 22,242,410
bushels, and had 51,864 bushels on hand. The
report showed a total transformation of 6,091,-
129 bushels of low-grade wheat into wheat of
higher gradings. It did not explain the secret
of this magic, and had no need to explain it;
affidavits could not have made it clearer or
more certain. The elevator operators took
certain quantities of No. 1 Hard, and mixed
it with 4,000,000 bushels of low-grade wheat
and called the mixture No. 1 Northern; and
certain other quantities of No. 1 Hard,1 and
mixed that with about 1,500,000 of still
lower grades and called that hash No. 2.

By this hocus-pocus not only was its value
raised to the great profit of the mixers, but
all this wheat was now made available for
the filling of contracts in future tradings,
a matter of vital importance to those carry-
ing heavy speculations on the gambling side
of the market.

As to which was the chief loser, the farmer
or the buyer, in these extraordinary trans-
actions at the elevators, we have plain enough

1 Not more than 310,110 bushels of No. 1 Hard could have been
involved in both of these transactions; a comparatively insignifi-
cant amount.

55

THE STORY OF THE NONP ARTISAN LEAGUE

testimony in the fact that under certain con-
ditions appeals were possible from the gradings
made by the state inspectors at Minneapolis.
Observe then that all of these appeals were
on the ground that the gradings had been
too low, and the great majority resulted in
the gradings being raised. That seems to
tell the story. But appeals were cumbersome,
slow, and tedious. Moreover, they availed
nothing in the case of the wheat sold at the
country elevator, and, practically speaking,
they were of little advantage to the farmer.

If we go back now to the adventures of
John Evans's wheat on the Chamber of Com-
merce and connect it with the mystic trans-
formations of the terminal elevators, we shall
see the grain industry as it really is in America.

Suppose Evans to have sent five cars of
wheat direct to a Chamber of Commerce com-
mission house, Roe & Company, and when
the railroad company has had its turn at it
and has charged for hauling it far more than
the service is worth, the five cars go the usual
way. They are inspected and graded, one
car, let us say, No. 1 Northern, one No. 2,
one No. 3, one Ilejected, one No Grade.
Roe & Company, as before described, get
a sample of cacli car and before the gong
sounds on the exchange that morning one
of their agents has sold all five cars to another
of their agents operating under another name

MAGIC OF THE MIXING-HOUSE

and charged the usual one cent a bushel
commission. The second agent sells the five
cars to a third, and the third, maybe, repre-
sents a terminal elevator owned by Roe &
Company, and sends the wheat to that
elevator, whither it might as easily have been
sent in the first place.

There the contents of all five cars are poured
into one bin, whence, in the course of time,
it emerges graded as No. 1 Northern, and is
sold for such at the top of the market. This
makes the balance-sheet of Roe & Company
look like this :'

Bought five cars of wheat at 85^/2 cents,

average $4,275

First commission $ 50

Sold same wheat, after mixing, as No. 1,

at 91 4,550

Profit on mixing trick 375

Second commission 50

Profit by buying under real market, say. 25

Total profit $500

Less legitimate brokerage if sale had
been made for farmer direct to miller
at price the miller paid 50

Total illegitimate profit, called

by the farmer "gouge" $450

Or $90 a car. With $8 a ton for screen-
ings to be added.

1 It should be noted that these prices are calculated on the market
as it was at about the time of Evans's collapse.

THE STORY OF THE NONPARTISAN LEAGUE

Meantime the farmer's account would look
like this:

One car No. 1 Northern at 90} 2 cents $ 905

One car No. 2 at 88 880

One car No. 3 at 85 850

One car Rejected at 79 790

One car No Grade at 75 . . 750

Total .$4,175

Less commission. . 50

$4,125
Less freight at 16 cents a cwt 480

$3,645

Less switching charges, whether any
were actually paid or not 7.50

Net receipts $3,638 . 50

If the wheat when he sold it had been
graded as it was when it passed out of the
terminal elevator he would have received
$4,550, less commission and switching charge.

After the Great War began, wheat prices
rose, particularly in the seasons when the
farmers had disposed of their grain; but
labor and the prices of necessaries rose like-
wise, so that the margin for the farmer, except
at rare intervals, remained about the same.
In 1917 a group of representative farmers
in North Dakota worked out the acre cost
of raising wheat as follows:

58

MAGIC OF THE MIXING-HOUSE

Seed (\Yi bushels at $3) $ 4 . oO

Disking 1.00

Plowing 3 . 00

Harrowing twice .70

Drilling 1.00

Twine 33

Cutting and shocking 3

Threshing 1

Hauling

Taxes 32

Insurance .80

Fertilizer 4.00

Interest (8 per cent, on $50) 4 . 00

$23 . 95

This was presently shown to be too low for
the run of farms in the state. About that
time the government fixed the price of No. 1
Northern at $2.20/^ a bushel on the Minneapo-
lis market. The Commissioner of Agriculture
of North Dakota estimated $26. 5G an acre as
the average cost of producing wheat. In times
of drought or unfavorable weather, such as
North Dakota had in 1917 and 1915, ten bush-
els average to the acre would be a big yield.
On that basis the farmers were losing 40 cents
a bushel on the Minneapolis price for No. 1
Northern. But at the local elevator they never
received the Minneapolis price, because there
must be deducted freight charges, commissions,
and all the rest, and, under the grading system
that existed, if they raised No.l Northern they
could not hope to have it graded better than

THE STORY OF THE NONPARTISAN LEAGUE

No. 2, whereas the cost of raising No. 2 was
the same as the cost of raising No. 1.

The farmers pocketed their losses and raised
the wheat, but it is not remarkable if they
felt no burning joy over their balance-sheets.
They knew well enough that of every dollar
paid by the retail purchaser for farm products
not forty cents went to the farmer that grew
the products, and when he found the whole
burden of the increased cost of living was
(in some quarters) laid at his door he knew
how huge was that injustice.

Dr. E. F. Ladd of the North Dakota Agri-
cultural College, whose researches in these
subjects have made him an international
authority, and to whom we shall often have
occasion to refer, ascertained that a barrel
of flour would make 300 loaves of 14-oi.ace
bread. Supposing a North Dakota farmer
to receive an average of $2 a bushel for his
wheat in 1917 and 1918, his part in the retail
price of such a loaf was 3 cents, while the
purchaser paid 8 to 10 cents. Even if the
farmer should get as much as $3 a bushel for
his wheat and bread remain at the same price,
his share in price would be less than 4}/£ cents.

There is, besides, the item of wheat offal,
for which Llie farmer gets nothing, although
it is a source of golden revenue to the miller.

If we put the price of wheat as high as $2.7,5,
consider only what are called "mill feeds," (a

CO

MAGIC OF THE MIXING-HOUSE

by-product of milling) and going the limit,
say that four and a half bushels of wheat are
required to make three hundred loaves of
bread. We shall then have this showing:

300 loaves of bread at 10 cents $30.00

Mill feeds in four and a half bushels of wheat . . 1 . 50

Total $31.50

Four and a half bushels of wheat at §2 . 75 cost . 12. 37

Margin §19.13

It is manifest that here is a huge discrepancy.
The bread -eaters are paying far too much; the
wheat-growers getting far too little.

It was not the wheat-growers alone that
suffered from the abnormal conditions brought
about by the system that custom had im-
posed upon farming. In the darkest days of
the Northwest, inspired preachers of the
doctrine of patient submission to organized
greed were in the habit of urging upon the
lowly agriculturist a variation of crops as the
real panacea for all this. Investigation has
shown that in the regions where there was
this blessing in full blast, where the soil was
peculiarly fertile, and where all things ought
to smile upon the husbandman, the net prod-
uct of his toil for a year was less than that
of a ditch-digger. If this be doubted, I take
the actual records and invite comment thereon
from sanguine souls that still cling to the
notion that the farmers are wading knee-deep
in legal tenders. The two counties are in

61

THE STORY OF THE XOXPARTISAN LEAGUE

the state of Minnesota; the line "Labor
income" means what the farmer had left
after all deductions.

Ottrrtail Cnunty,

Clay County, Avrr . of 63 farrn-s,

Ater. of 56 f'irm» I'rl\C'tn Htipiils

at llawlry. arui K \ard.

Receipt.?: Ji>;* li>li

Potatoes $ 470 $

Wheat 537 742

Oats and barley 208

Hay and other crops 133. 193

Increase feed-supplies 218 41

Cream and butter 192 330

Cattle 207 335

Hogs 107 :m

Other stock 119 125

Miscellaneous income 147 31

Total $2,483 $2.131

Expenses:

Labor $ 333 $ 270

Machinery, buildings, and

fences 147 121

Feed and seed grain bought. . 94 80

Threshing, silo filling, twine. . 118 87

Taxes and insurance 110 78

All other farm expenses 116 70

Total $ 944 S 712

Net income of farm 61,3:5!) $1.139

Capital: Real estate $13,408 S*10.800

Live stock . . 1,01 I 1.790

Machinery, feed, etc. . 1,010 9-J I

Total . 810,098 $1,5.380

Interest on total capital at 3

per cent .
Labor income . .

$079
700

MAGIC OF THE MIXING-HOUSE

In these conditions it is easy to understand
why the farmers regarded with always grow-
ing disgust the various efforts of philanthro-
pists and others to inculcate thrift or start
movements of "Back to the land!" When
a single elevator could in three months, by
merely shifting the grades of the wheat it
housed, clear a profit thereon of $83,000, and
when commission men could easily make $90
a car of illegitimate proceeds at the farmer's
expense, it was evident that wrhat was needed
was not more thrift, but less larceny. It was
also evident that farming would never be
anything but hopeless drudgery so long as
this system existed. Senator McCumber's
estimate of $70,000,000 a year of loss to
the Northwestern grain-grower by false grad-
ing alone seemed in the light of these facts
to be much too conservative. An authority
at the North Dakota Agricultural College
figured the annual loss to the farmers of that
state through the unjustifiable seizure of his
screenings at two million dollars. It was but
one item in a long list. On every side he
was the prey and sport of powerful forces
that stripped him, as he bitterly phrased it,
to his shirt and his socks. From dockage
for - dirt that did not exist to charges for
switching cars that were never switched, the
System, to his mind, was organized against
him.

63

CHAPTER IV

PHANTOM SWITCHING, FALSE BALANCES

BLESSED be investigation. Lexowing and
muckraking, much despised at the time,
have been the salvation of this country.
Nothing helps a bad situation so much as
some good competent X-raying. We can
have perfect confidence in it for the reason
that this is essentially a moral nation; a fact
constantly overlooked by foreign visitors
and native cynics, but always in emergencies
shining forth to confound both. To right
any wrong in the United States is, after all,
a simple process. You have only to exhibit
it where all the people can see it plainly; and
to that end a most gracious means is the
investigating committee of Congress or of
a legislature, providing it is on the level and
not more interested in hiding things than in
uncovering them. There was never yet a
notable muckraking by any such committee
that did not result in good.

At an investigation in 1913 of grain ex-
changes by a committee of the Minnesota

64

HOW FALSE CHARGES WERE MADE

House of Representatives there were dis-
closed many strange matters, and among them
this practice of the switching charge just
referred to. News of it was received in some
quarters with amazement, and in others with
denunciations, as of a thing no better than
Mr. Fagin's "kinchin lay." Nevertheless,
it had grown to the intrenched condition of
a vested right. It consisted of a uniform
charge in the settlements between commission
houses and their country customers, of $1 .50
on each car of grain for the alleged switching
of that car. The witness is Mr. J. J. McHugh,
secretary of the Chamber of Commerce, and
Mr. Manahan is examining him.

MR. MANAHAN. — Here is a custom which I charac-
terize as a fraudulent custom on the part of the
Chamber of Commerce, and I am glad to see that Mr.
McHugh has too much self-respect to attempt to de-
I'end it. I say it is a custom of swindling the shipper.
For years, without any regard to justice, the Chamber
of Commerce members have soaked the shipper $1.50
in thousands of cases where they did not pay it [the
switching charge] at all.

THE ACTING CHAIRMAN OF THE COMMITTEE. — We
would like to have this question plainly answered.
Do you consider this to be a fraud?

MB. McHuGii. — I said no. That answers the ques-
tion. I do not wish to pass upon the general propriety
of the practice. I do not think it is a fraud. That is
my opinion.

THE ACTING CHAIRMAN. — Will you explain — if the
man that ships 100 cars and pays $1.50 switching

65

THE STORY OF THE NONPARTISAN LEAGUE

charges on those 100 cars, and as a matter of fact they
are not paid to anybody, don't you consider that this
man should be entitled to his $1.50 [a car]?

A. — There I said I don't think the committee
should consider me competent to furnish the informa-
tion desired. It is for the committee to pass upon the
propriety or impropriety of any rule we may have. . . .
I testified that there is no rule in the Chamber of Com-
merce that recjuires the members to charge $1.50
switch. It requires them to charge a switch, not $1.50.

Q. — I ask this question, Can you to-day name us a
single instance where you have taken into this private
court of yours in the Chamber of Commerce and cen-
sured any of your members for charging an illegal
switching charge?

A. — I do not know of such a case. Sales are made
subject to $1.50 switch.

At another time there was a sharp colloquy
between Mr. Manahan, counsel for the farm-
ers, and Mr. Lind and Mr. Mercer, counsel, re-
spectively, for the commission men and for the
Chamber. Mr. Manahan produced evidence
that every year hundreds of shippers' cars
were received and switched by the railroad
companies free, but nevertheless the charge
of $1 .50 was figured in the settlements with
the shippers. The origin of the charge was an
understanding that when a car was received
by a railroad company in Minneapolis and
switched to an elevator's side-track, or to
another railroad to be shipped out, a charge
of $1.50 was imposed by the railroad coin-
puny. But many railroads had elevators

GO

HOW FALSE CHARGES WERE MADE

on their own rights of way, and made no
charge for switching to these. Some rail-
roads owned tracks into the city from the
West and out of the city to the East, and made
no charge for switching between these. Nev-
ertheless, the switching charges appeared
in the settlement made with the farmer or
shipper by the commission house.

Mr. Lind said that the commission men
did not get this unjustifiable toll.

MR. MANAHAN. — Who does get it, then?
MR. LIND. — Either the railroad or the millers.

Mr. Manahan said that he meant the money
extracted from the shipper when the rail-
road had made no charge.

MR. MERCER. — It is reflected in the price. It makes
very little difference, one way or the other.

MR. MANAHAN. — It makes $1.50 on one-fourth of the
cars.

Here the witness that was on the stand at
the time, a farmer, broke in to correct Mr.
Manahan. He said that when cars were
shipped in to be sold on commission the $1 .50
was charged on every car.

MR. MERCER. — Now, don't misunderstand me. It
is reflected in the price.

MR. MANAHAN.- — It is not reflected a bit in the price.
In the real sense of the word it is straight graft.

WITNESS. — Of course it is ! l

1 Testimony before Minnesota House Committee, pp. 938-39.
6 67

THE STORY OF THE NOXPARTISAN LEAGUE

When this matter was before the committee
of the National House of Kepresentatives,
Mr. McIIugh again testified about it.

Question.- — On a great many hundred cars coming to
Minneapolis the Chamber of Commerce has charged
the farmers a switching charge without the car being
switched at all?

Anyircr,— Yes sir.

Q. — Isn't that crooked?

A. — I do not think so.

Finally it appeared that so far as the rail-
roads were concerned 91 per cent, of the
freight-cars they handled moved free of
switching charges and such charges were
imposed on but the remaining 9 per cent.
Testimony at page 94G of the Minnesota
House Committee's proceedings showed that
the product of the switching charge unjusti-
fiably levied upon the 91 per cent, of the
cars went to the millers and the commission
men.

The investigations at Washington and St.
Paul had also this definite result, that they
removed the last shadow of uncertainty us
to the reason for the ceaseless activities of
the Chamber of Commerce to maintain every
existing condition in the grain trade. For
instance, an analysis of its membership showed
this rather astonishing result:

G3

HOW FALSE CHARGES WERE MADE

Classified List of the Memberships in the Minneapolis
Chamber of Commerce:

Line elevators 135

Terminal elevators 39

Commission houses 200

Feed houses 5

Shippers 34

Hay dealers 7

Linseed-oil concerns 13

Millers 50

Maltsters 8

Bankers 8

Capitalists 6

Manufacturers 7

Lawyers 2

Railroad representatives 2

Farmers 2

Insurance agency 1

Total 318

An institution chartered specially by the
state as a public market where the produce
of the farmer was to be sold; and of 318 mem-
bers of that institution only two were even
classified as farmers, and of these common
report said that neither was cultivating any-
thing but a bank-account.

And again here was some of the distribution
of memberships, and the full explanation of
the nature of the control of the institution lay
in that distribution. Each membership in the
Chamber carried a vote and any firm or cor-

G9

THE STORY OF THE NONPARTISAN LEAGUE

poration could own as many memberships as
it pleased.

Owner Memberships

Van Dusen-Harrington Company (grain

handlers) 21

Washburn - Crosby Company (millers,

grain handlers) 24

Big Diamond Mills 10

Pillsbury Flour Mills Company 9

E. S. Woodworth Company (grain) 9

T. M. McCord Company (grain) 9

The F. H. Peavey Company (grain) 8

McCaul-Dinsmore Company (grain) 7

E. L. Welch Company (grain) 7

The Minneapolis banks 8

Sometimes a company, as the Van Dusen
Company, for instance, owned memberships
under different names, but voted them all.

Statements that revealed the Chamber's
conception of itself as a body coequal wTith
the government and not subject to investi-
gation were frequent at all these investiga-
tions. Mr. McIIugh, the Chamber's secre-
tary, told the committee of Congress:

The institution [Chamber of Commerce] being a
private corporation, there is no reason why its affairs
should be published at all, any more than those of any
other private corporation.

At the St. Paul hearing dialogues like the
following were constantly occurring:

MR. MERCER (counsel for the Chamber). — I object
to the question on the ground that it is not within the
power of the legislature to investigate that.

HOW FALSE CHARGES WERE MADE

MR. MANAHAN (counsel for the farmers). — We will
see if it is within the power.

MR. MERCER. — This is a private corporation, organ-
ized under the statutes, and purely private.

What is equally remarkable is the revelation
that the inside control exercised the right
to exclude any person, even when armed
with a membership, from any actual partici-
pation in the management of the Chamber.
This is part of the examination of Mr. Mc-
Hugh, before referred to:

Question, — If a man buys from any individual holder
a membership, that does not entitle him to a place on
the board or the floor?

Answer. — No sir. Membership in the Chamber of
Commerce is a life membership, as in a fraternal order
or church.

Another startling revelation was about a
matter of such primitive importance in com-
mercial honesty as the false balances, long
ago said to be an abomination to the Lord,
but subsequently proved to be quite other-"
wise to the grain trade in North Dakota.
There was, to begin with, the fact that in an
average year about five hundred thousand
bushels of wheat in that state would be taken
to the country elevators and apparently never
reach any market. Between the farmer's
wagon at the elevator side and the final ac-
counting it most strangely vanished, took
wings, departed, or marched away. The farm-

71

THE STORY OF THE NONPARTISAN LEAGUE

ers explained this and other marvels of the
trade by accusing the weighing and elevating
system then in use. I had better cite here
an unimpeachable authority, for I am aware
these charges must be viewed with incredu-
lity; men engaged in reputable business re-
sort to no such devices, we say. In 1906 the
whole subject of the grain trade in the state
was investigated by that committee of the
North Dakota Bankers' Association to which
I have before referred; it was a history-making
inquiry. These grave and reverend business
men, the most reputable and conservative
in the state, were not likely to report anything
that would give comfort to pestilent agita-
tion and still less likely to sanction any com-
ment injurious to existing business prar'ices
unless they had proof. Their report says:

We found that grain is inspected, graded, and the
dockage fixed [at the head of the Lakes] by the state
inspector under the rules of the Minnesota Grain In-
spection Board. The grain is then ordered into one
of the terminal elevators and, after being unloaded, is
elevated to the top of the elevator, where it is weighed.
During the process of elevating all the grain is subjected
to a suction draught in order to keep the building free
from dust (?) l This is an injustice to the shipper, as
in our judgment all grain should be weighed immedi-
ately upon being unloaded, and nothing should be
taken from it before it is weighed. The amount of
light grain and dust taken out under the present

1 The question-mark is not mine, but the committee's, and seems
to be justified.

HOW FALSE CHARGES WERE MADE

method simply depends upon the force of the suction
draught.

Sometimes that force, men say, was sufficient
to blow a pocket bunch of keys from the open
palm of a man's hand, held in the air stream.
It was here, doubtless, that some of the miss-
ing wheat disappeared; for we must not
forget that it was on the weight after this
process that the farmer was paid. The whole
thing savors much of medieval practices, I
admit, but there is uncontrovertible proof
that it was at least as common in North
Dakota in the year 1915, for instance, as was
a similar but much less poetic practice in the
days of Chaucer. According to that truth-
ful chronicler of the manners of the four-
teenth century, the miller maintained a rule
that he would steal enough wheat from his
customer to make a good cake. At least,
Chaucer called it stealing; if he had lived
in these days he would have called it, maybe,
dockage; which has a much nicer sound, as
all must agree. We may also be reminded
of the farmer's boy of about the same period
that made a comment still embedded in Irish
folklore. For the first time in his life he
went to the neighboring grist-mill, and when
he came back, being asked what he saw that
most impressed him, remarked that the
miller's pigs were most amazingly fat.

73

THE STORY OF THE XOXPARTISAN LEAGUE

Mr. Benjamin Drake of Minneapolis, who
has done much by his painstaking investiga-
tions to clear the whole subject of grain ma-
nipulation, once gave this testimony before
the Rules Committee of the national House
of Representatives:

Another abuse practised by the Minneapolis elevator
and milling combine is closely linked with the state
system of weighing grain. Under the present system
of state weighing two kinds of scales and two distinct
methods of weighing are permitted. One consists of
weighing the grain in car-load lots upon a track scale.
The car of grain is first weighed "heavy" upon the
scale. The grain is taken out and the car is weighed
empty. The difference between the two weights ob-
tained represents the weight of the wheat in the car
accurately and, practically, with no chance of error.
This system, according to all information which I have
been able to obtain, is not used at more than one-
third of the terminal elevators and the great mills of
Minneapolis. At the remaining elevators and mills
another system is employed which almost always re-
sults in a loss of weight to the shipper. Under the
practice last referred to the grain is lifted in quantities
of perhaps a hundred bushels at a time to the cupola
of the mill or elevator, where a small scale is installed.
Under this method the grain is usually carried one or
two hundred feet from the car. Some of the grain i.s
usually lost to the shipper in the transaction. Some-
times the amount is so small that it is negligible. At
other times it is considerable in amount. Aside from
the mechanical imperfection of the system it affords
considerable opportunity for dishonest manipulation.
The method of weighing last referred to is an injustice

74

HOW FALSE CHARGES WERE MADE

to the shipper, which constantly results in loss of his
product, and should be abolished at once.

This might be thought to explain where
the missing five hundred thousand bushels
went to every year; at least the farmers
could hardly be blamed if they assumed it to
be an adequate light cast upon this phase of
the mystery. But upon only a part of it, be-
cause Mr. Drake was speaking of the weighing
practices at the terminal elevators at Minne-
apolis, not elsewhere. There was also the
weighing operation at the country elevator,
and what that was like may be gathered
from the fact that when there came to be a
state department of grading, weights, and
measures in North Dakota, as we shall learn
hereafter, official testing of all the scales in
use at country elevators revealed 60 per
cent, of them to be false or defective.

CHAPTER V

THE HIGHLY INSTRUCTIVE STORY OF THE
"FEED WHEATS"

OBSERVERS that have any experience
in this world's affairs will see easily
enough what was the real source of these
complaints.

In the course of years wherein the farmer
had been isolated and inarticulate, there had
grown up a huge system by which all the
normal profits of wheat production were
taken by middlemen, and these mostly super-
fluous or ornamental. As before noted about
such cases, this system had existed so long
it amounted to an institution. Custom and
habit are great matters. Any wrong can be
made, by the persons that get rich from it, to
look all but sacred; particularly if it can be
shown to have existed more than one genera-
tion. Our fathers endured it. Shall we be
wiser than they? In Lorna Doonc the outlaws
had lived so long upon the surrounding
country they spoke of and believed in their
right so to live upon it as inalienable, and

70

the people had been so long accustomed to
be robbed they were shocked at the suggestion
of a life of security. No living man was re-
sponsible for the system that had grown up
in the grain trade, nor any part of it; in the
main, no living man had known anything
else; and, like all such things that go uncom-
bated, it had a tendency all the time to get
worse. Even the farmers, always smarting
under a vague sense of injustice, had never
revolted effectively against it, and to a cer-
tain extent even helped it along by what
was assumed to be an inviting patience.

If the victims did not object, why should
anybody else bother?

There was, however, a certain great prin-
ciple involved in all these matters, a principle
coming home to every person that ate bread
as well as to the farmers that grew the wheat,
and what that principle was we can see better
from the next incident in this history.

The Agricultural Department of the United
States and similar beneficent institutions in
the individual states are continually trying
to improve the product of our fields by intro-
ducing new varieties of seed or of plant,
developed abroad or in our own experimental
stations. About twelve years ago there was
brought into North Dakota in this manner
a new species of wheat that bore the name
of "velvet chaff." It proved hardy and well

77

THE STORY OF THE XOXPARTISAN LEAGUE

adapted to the region, and the next year great
quantities of it were sown.

When it began to reach the Minneapolis
Chamber of Commerce, the mysterious San-
hedrin there that determined so many things
for the Northwest, held that "velvet chaff"
was an inferior product and fixed a price
upon it 27 cents below the corresponding
grades in other wheats. In one season 30,-
000,000 bushels of "velvet chaff" passed
through the hands of Minneapolis buyers,
and at the prices thus arbitrarily fixed for it
this quantity represented an abnormal profit
of $8,100,000. For "velvet chaff" was in
reality one of the best milling wheats ever
grown, and the mills that got it for 27 cents
a bushel less than they would have paid for
similar grades of a different name put it
into their best flours1 and harvested new and
unusual revenues therefrom.

Almost the same record with the like illegiti-
mate profits was made upon the introduction
of durum, or macaroni wheat, another much-
prized innovation of the national Agricult-
ural Department. It is no wonder that after
repeated experiences of this kind the North-
western farmers became cynically doubtful

1 The demonstration of this fact was due to the indefatigable
Dr. E. F. Ladd. of the North Dakota Agricultural College, who is
surely entitled to be called one of the most u.seful men of all time.s
or lands. The farmers of the United States can never liquidate their
indebtedness to him.

jTi *~~v ; -.—;-•-• ._•__• ^7^

UL! i-l-j4 n w: i : v-fi

MINNEAPOLIS CIIAMliKK OF COMMERCE Ul'ILDIXG

STORY OF THE "FEED WHEATS"

of the value of these departments, which
were always, at the public expense, devising
and inventing improvements that the Minne-
apolis combination promptly and easily ab-
sorbed for its own greater emoluments.

And I may here remark that while the effort to
represent the farmer as dull like the clods in his
field is of great antiquity and much celebrated
in some forms of literature, the fact is we shall
have to abandon that comfortable superstition
now. It was not upon unsuspecting yokels that
these iniquities were practised, but upon men
alert, keen-witted, full of reading, experienced.

In March, 1914, a South Dakota farmer
testified before the Rules Committee of the
national House of Representatives that in
the previous fall he had sold his wheat at
his local elevator at sixty-nine cents a bushel
on the solemn representations of the elevator
man that this was the actual market. He
went home with his newspaper under his arm,
studied the Liverpool market reports, figured
accurately the cost of handling, transporta-
tion, commissions, and the rest, and proved
that lie had been defrauded of seven cents
a bushel.1 Similarly, the bulk of the farmers
knew perfectly well the nature of all these

1 We produce annually in this country about 5,000,000,000 bushels
of grain. Suppose the manipulators to take in this manner but one
cent a bushel, that would be $50,000,000. Suppose the experience
uf the South Dakota farmer to be average, that would be $350,000.000
u year taken from the farmers by this process alone, and when to

79

THE STORY OF THE NONPARTISAN LEAGUE

transactions. They knew, for instance, that
four and a quarter bushels of wheat make
a barrel of flour and that at the current
prices for the by-products of those four and
a quarter bushels such by-products paid mill-
ing cost and left the flour almost clear profit
to the miller. Here was "velvet chaff"
indeed, well worth having! They had also
a general notion at least that these gigantic
profits were taken up and concealed by
huge over-capitalizations and that what ap-
peared to be a modest profit of 7 per cent,
on the capital stock was in reality often
28 per cent, or more on the money actually
invested. There were even farmers in the
Northwest that knew as well as any professor
in any chair of political economy (as well or
better) what were the relations of this system
to the cost of living. They were also familiar
with such instances as this, which I take from
the investigations of John Kenneth Turner:

On January 1.5, 1916, at Minot, North Dakota, flour
was selling for $7 a barrel. Dividing ^/\ into 7, we
have $1.64% as the milling value of the wheat, of which
that flour was made. But take No. 1 Northern, the
highest grade of wheat offered at Minot. Did the
farmer get $1.64% for his No. 1 Northern? He did
not. The highest priee the mill at Minot would pay
for such wheat was the price paid at the local elevator,

this ;ire added the other practices outlined in these records, of which
they ;ire the victims the total becomes overwhelming and explains
all the farmers' difficulties in this fertile and highly blessed land.

80

STORY OF THE "FEED WHEATS"

which was $1.15. And this price, as will be seen, omits
the value of the by-products, and is subject to deductions
for dockage and the peculiar ministrations of the scales.

To this pungent example let me add another
that to the Eastern mind may seein still more
remarkable :

The farmer that grew that wheat must have
flour for his household. There is a large and
busy mill at Minot grinding such flour. When
he went to this mill to sell his wheat he found
that he must pay the freight on it from Minot
to Minneapolis, for this freight charge was taken
from the price he received. From the mill he
went to a local grocery store and bought a sack
of flour ground there at the Minot mill and from
wheat that he and his neighbors had grown, and
found that he must pay the freight on that flour
from Minneapolis to Minot. Neither wheat
nor flour ever journeyed outside of Minot; yet
he must pay a freight charge on both.

The buying price of wheat wTas the Minne-
apolis price less the freight to Minneapolis;
the selling price of flour was the Minneapolis
price plus the freight from Minneapolis — on
wheat and flour that never saw Minneapolis
nor any other place but Minot.

Only a universal belief in the dullness of
farmers could suppose that such a condi-
tion would last longer than the time required
for the farmers to get the power to end it.

And again, grain grades, as I have pointed

81

THE STORY OF THE NONPARTISAN LEAGUE

out, although of basic importance to the
farmer, existed solely on arbitrary rulings
made by the Minneapolis Chamber of Com-
merce; the farmer had neither share nor in-
fluence in the making of them. It was, Take
it or leave it; heads I win, tails you lose; these
are the rates. In 1916 the wheat crop of North
Dakota suffered from drought, with the result
that much of the grain came shriveled to mar-
ket. Thereupon the Chamber established a
new set of grades to meet what was pretended
to be a new condition. The shriveled wheat,
the dealers declared, was unfit to be ground
into flour; nothing could be done with it better
than to feed it to live stock, and even at that
grave doubt must be entertained as to whether
the pigs could eat it. However, the dealers
would do the best they could with it, and they
made out the following grades:

No. 1 Northern to weigh not less than 57 pounds to

the bushel.
No. 2 Northern to weig'h not less than 50 pounds to

the bushel.
No. '5 Northern to weigh not less than 54 pounds to

the bushel.

No. 4 Northern, ;>.'> pounds.
No. 4, 5-2 jMninds.

No. 4 Feed Spring', 40 to 51 pounds.
A Feed, 47 to 4S pounds.
1} Feed, 45 to 40 pounds.
(' Feed, 43 to 44 pounds.
1) Feed, '55 to 4-2 pounds.

STORY OF THE "FEED WHEATS"

These grades, after No. 4 Northern, were
new designations; no one had ever heard of
any such thing as "A Feed" or "B Feed."
Nevertheless, these innovations, no matter
how strange or arbitrary, became instantly as
effective as if they had been laws of Congress.
At the time the farmers, however they might
be wronged in this way, had no redress against
such decrees, and an immense amount of
North Dakota wheat was graded and sold on
these classifications.

Yet the pigs got none of it and none went
to fatten other live stock. Subsequent in-
vestigation showed that all of the "Feed"
grades had substantial milling values, all
were ground into flour, and even the despised
"Feed D," away down at the bottom of the
list, so bad that by a fiction the omnivorous
hog was supposed to turn from it, made
bread of a quality superior in nutritive content
to bread made from the aristocratic No. 1.

All this was demonstrated at the North
Dakota Agricultural College.1 Repeated tests
made there showed that 100 pounds of average
No. 1 Northern wheat yielded about C9 pounds
of flour, while 100 pounds of the lowly "D
Feed" yielded GO pounds of the same class
of flour— "not quite so white," says the

1 Details may be hud from Bulletin Xo. 119, issued by the college,
and from Wheat: Its Milling Value and Market Value, by Dr. E. F.
Ladd.

7 83

THE STORY OF THE NONPARTISAN LEAGUE

report of the college's investigations, "but
more nutritious and producing larger loaves,
since it contains more gluten." From 100
pounds of "A Feed" wheat the college tests
produced an average of 63 . 72 pounds of good
flour. Every other grade of "Feed" wheat
yielded more than 60 pounds of good flour
for each 100 pounds of grain.

It was perfectly plain, therefore, that the
new classification was unjustifiable and must
cause the farmers great loss. In December,
1916, the ruling prices at which the wheat
crop was being bought showed a difference
of 79 cents a bushel between No. 1 Northern
and "Feed D," which the tests at the college
had revealed to be of about the same actual
value to the millers. Taking the current
prices for wheat and for flour, this table
indicates how great that loss was:

Prirr to Vulu' tr, Crnmi Prnf.t

Grade the farmer the M Uler (l\r Cent.)

No. 1 Northern $1 . 73 $2 . 10 21

No. 2 Northern 1 . 70 2.17 27

No. 3 Northern 1 . (5-2 2 . 04 26

No. 4 Northern 1 . 45 2 . 05 41

No. 4 1.3!) 2.05 48

A Feed 1.2!) 2.015 57

B Feed 1.14 2.0'5 78

C Feed 1.01 2.00 03

]) Feed 94 1.!)!) 112

A thoughtful examination of this table
will probably suggest a better reason for the

84

STORY OF THE "FEED WHEATS"

introduction of "Feed" grades than the needs
or palates of the country's live stock, and with
a profit of 112 per cent, on "D Feed" we shall
not be astonished that much wheat of that
variety passed into the elevators.

Or to make the case still plainer, let us
suppose that nine North Dakota farmers
grew each one car-load of wheat and these
nine cars supplied one car for each of the
nine grades. We should have then this show-
ing of the relation of the amount the farmer
got for his wheat to the amount the consumer
paid for it when it became flour:

Farmers'

What the What the Percentage of

Grad-e Farmer Got Consumer Paid Consumers' Price

No. 1 Northern $1,526.75 $2,558.47 59

No. 2 Northern. ... 1,479.01 2,627.11 56

No. 3 Northern. ... 1,387.73 2,413.90 57

No. 4 Northern... . 1,214.43 2,409.24 50

No. 4 1,156.65 2,415.62 47

A Feed 1,034.39 2,330.73 44

B Feed 876.05 2,288.43 38

C Feed 814.97 2,318.18 35

D Feed 653.01 2,107.03 30

Yet on the basis of the actual value of the
wheat — that is, on the basis of flour and not
of millers' profits — the farmer that received
$653.01 for his grain should have had about
as much as the farmer that received $1,562.75,
for both handed to the miller material for
the making of about the same quantity of
flour of the same kind.

THE STORY OF THE NONPARTISAN LEAGUE

The farmer that sold No. 1 Northern
wheat received 59 cents of each dollar paid
by the final consumer; the farmer that sold
No. 2 Northern received 56 cents; he that
sold No. 3 Northern received 57 cents; but
he that sold A Feed received only 44 cents,
he that sold B Feed 38 cents, and he that sold
I) Feed 30 cents, and for these differences there
existed not a shadow of reason except that,
having the power to take high toll, the milling
combination exercised that power.

With all this disposal of the fruit of his
industry the farmer had nothing to do or
to say. An authority, absolute, irresponsi-
ble, unquestionable, fixed the price at which
lie must deliver his wheat and fixed it wrong.
Beyond any doubt, fixed it wrong, for here
is the unassailable proof that it was wrong.
Wheat worth by tesL. at least $1 .50 a bushel
in true milling value was sold at 94 cents.
For no reason in the world except that a,
certain abnormal system created fictitious
grades and imaginary market conditions and
compelled men to accept these fictions.

Doctor Ladd estimated that the loss thus
occasioned to the farmers of North Dakota
averaged 45 cents a bushel. AM i eat crops
in North Dakota range from 50,000,000 to
1 '•25. 000, 000 bushels. Supposing the average
to be 85,000,000 bushels, this would indicate
a loss to the sUite of $38,000,000. Doctor

Sli

Ladd estimated that at the time he made his
experiments North Dakota had sold 20,000,000
bushels of the crop of 1916. On this it had
lost $9,000,000 on the one account of false
gradings, not to mention the other items in
this long and dismal balance-sheet.

It would be preposterous to suppose that
American farmers would continue year in
and year out to submit to such conditions.

Then, again, the process of shipping the
wheat to be ground elsewhere was in itself
and always must be an injury to the state.
Doctor Ladd pointed out that the screenings
and by-products to w^hich the farmer was
justly entitled and of which he was outra-
geously deprived totaled every year some
bulky items. When the wheat crop of North
Dakota was 100,000,000 bushels there would
be shipped away with it these by-products:

Screenings 119,700 tons

Bran 381,300 "

Shorts 454,560 "

all of definite value, both in terms of immedi-
ate money and for fertilizing through stock
feeding. The raising of live stock was de-
veloping rapidly in the state and there stood
the most amazing fact that when a farmer
that was also a stock -feeder had been deprived
of these by-products in his own wheat, he
was obliged to purchase at high prices the

87

THE STORY OF THE NONPARTISAN LEAGUE

same by-product that had been skimmed
from a brother farmer's wheat, if not from
his own. It is the contemplation of a few
pivotal facts like these that takes away all
the mystery from the increase in the cost
of living.

Besides the stock-feeding value of these
products, we are also to remember that year
after year the soil of North Dakota was
being impoverished, and so long as the wheat
was sent elsewhere to be ground there was
no chance that from it any part of the lost
fertility could be returned from its own crops.
Doctor Ladd showed that the amount of fer-
tility carried out of the state in the by-prod-
ucts of one wheat crop of 100,000,000 bushels
was as follows:

Nitrogen 46,018,400 pounds

Phosphoric acid 46,648,7(50

Potash 10,700,220

Lime 1,787,280

Contemplating this impressive showing,
Doctor Ladd wrote these conclusions:

All of the fertilizing material should he retained in
the state and returned to the land. The state can
only become great agriculturally and continue its de-
velopment by promoting such a system as will enable
the return of at least a considerable share of this
fertility and the marketing of products in the form of
f>eef, pork, mutton, butter, flour, and the finished
bread products. To insure this end means the de-
velopment of the manufacturing agricultural indus-

ss

STORY OF THE "FEED WHEATS"

tries to the fullest possible utilization of all these
products on the farm, in the dairy, in the mill, and in
the bakeries, and these industries should be encour-
aged, fostered, and developed by the state through
every reasonable means, so as to insure continued
prosperity to all our people and to future generations.

Here was the verdict of science, not of the
doctrinaire nor the propagandist; the calm
verdict of science viewing evidential facts.
We shall have occasion to recur to it as this
story progresses; therefore with all possible
emphasis I desire to beg attention to it now
as the scientific basis for a sequel that any
man knowing the American spirit would say
was certain.

Science had also another word to say about
these matters not less important. The Agri-
cultural College of North Dakota had set
up a mill, ground wheat, baked bread, and
based its findings about the actual value of
Feed wheat and other grades upon the chemi-
cal analysis of this bread. At every step it
applied infallible tests. It weighed the wheat
in delicate scales, weighed the flour that re-
sulted, weighed the by-products, ascertained
the exact loss in milling, tested the flour for
water absorption, baked the bread and meas-
ured the loaf volume in cubic centimeters,
applied to each loaf the Howard Laboratory
color tests and scale, tested the texture of
the bread, ascertained the exact amount re-

89

THE STORY OF THE NONPARTISAN LEAGUE

quired of each grade of wheat to make a
barrel of flour, and to the thousandth decimal
the value of each 100 pounds of wheat in
flour-making. For six years the records were
kept. They showed some remarkable results.

Thus, to mention but one, in the market
No. 1 Northern wheat was usually quoted at
30 to 35 cents a bushel higher than the grade
known as Rejected. Yet in six years the
difference between these two grades in actual
milling value averaged only 15 cents.

This is an extraordinary fact and I am
justified in dwelling upon it for a moment.
It means that in those six years, 1911 to 1916,
inclusive, the farmers lost in the neighbor-
hood of twenty cents a bushel on all of their
wheat that was graded as Rejected, and
smaller amounts on all of their wheat that was
graded above Rejected up to No. 1 Hard,
the top of the grades. This seems so stu-
pendous I had better exhibit it in a table,
asking the reader always to bear in mind
that the figures of milling value are those
reached by six years of scientific research and
record-keeping :

" Sprrtiil " or Ascertained Milling

Grnilt Diffrrcru--e in Price Value by the Bushel

No. 1 Hard .07

No. 1 Northern 5 to 8 cents 2.03

No. 2 Northern 1 to 7 " 2.01

No. 3 Northern 3 to 6 " 2.00

No. 4 Northern 3 to 6 " 1.94

Rejected 4 to 10 " 1.88

STORY OF THE "FEED WHEATS"

This final demonstration leaves the sub-
ject perfectly clear. The reason why, when
the average cost of raising a bushel of wheat
in North Dakota was seventy -five cents, the
average price the farmer received for it was
seventy -three cents, is now as plain as day.
We can see why, writh some of the richest soil
on earth, farming in North Dakota was an
unprofitable business; why there were so
many abandoned farms; why the tide of
broken-spirited men returning by the trail
of Disappointment, beaten from that uneven
contest, sometimes equaled that other tide
that flowed into it by the highway of Promise;
why so much of the world's granary was only
a desert waste; why the foreclosure notices
crowded the newspapers with their melan-
choly tales of disaster; why the region that
should have been, of all the world, one of the
best for farming was one of the worst; why
those that remained to face the struggle
plodded on without hope or a fair chance in
the fight.

I have here before me a summary of these
conditions as they actually were. A farmer
prepared it, and for all the bitterness in it
he found logical and undeniable basis in
facts. He wrote:

THE STORY OF THE NONPARTISAN LEAGUE

THE FARMER'S ROUND OF PLEASURE

One dollar and thirty cents a bushel for wheat, and
$17 a barrel for flour.

Nine cents a pound for live hogs, and 35 cents a
pound for bacon.

Nothing at all for screenings, and $20 a ton for feed
made of screenings.

Twelve per cent, interest on loans (with little extra
bonuses to boot) and no alternative but to take the
gaff.

A cheap cigar a day before election and a stony stare
the day after.

Freight rates that prevent farmers from building up
industries at home.

Six hundred and fifty-three dollars for a car-load of
"Feed D" wheat that brings $1,058 two days later
without a kernel touched or changed.

Credit for 15,500,000 bushels of No. 2 Northern
that is converted into 20,000,000 bushels of No. 1 after
the grain sharks get it.

Having 3,700,000 bushels of wheat graded to him as
No Grade turned into Nos. 2, 3, and 4 after the grain
combine gets it.

Free speech galore during political campaigns, and
taxes to pay for legislation he didn't want the next
spring.

It seemed even so to men of disinterested
minds that could appraise the situation im-
partially. The farmer raised the wheat and
other men took the profit; other men that
never turned a sod nor held a plow nor for-
warded a bushel of the wheat, hut stood in

9*

STORY OF THE "FEED WHEATS"

line to snatch from the bushel as it passed.
All along that line it was one story of loss.
The farmer lost when he borrowed money
at exorbitant rates, when he sold his wheat
on fictitious grades fixed against him by a
power over which he had no control, when
he was docked for impurities that did not
exist, when his wheat was hawked about the
Minneapolis Chamber of Commerce by para-
sitical or phantom handlers and unnecessary
brokers, when it went to a mixing-house to
be hocused and doctored, when it was hauled
at extravagant rates by waterlogged railroads,
when he was charged for switching that was
never done and sales that were never made.
And all this supported and buttressed by huge
organizations, the huge bank, the huge finan-
cial interest, the huge railroad company, the
huge milling concern, the wealth, power, poli-
tics, social organization of the entire North-
west in one solid enduring league.

Apparently, you might as well go forth to
fight ocean tides. Yet there was one little
comment almost any man might have made
on this that would have greatly changed its
aspect. I have often marveled that it never
seems to occur to gentlemen engaged in the
alluring but dangerous excitements of profit-
eering. It is that when, on this continent,
at least, great masses of men long submit
with the fatalistic calm of the Orient to con-

93

THE STORY OF THE NONPARTISAN LEAGUE

ditions of fundamental injustice the fiber and
heart-strings and blood of the race will have
been chemically changed. Gentlemen en-
gaged in grasping 11 2 per cent, profit on every
car of wheat they could grade as D Feed
never thought of this fact. I think I may
say with confidence that they have thought
of it since — with considerable pain. But the
wholesome time to think of these things is
before you perpetrate any D Feed devices.
Afterward may be too late, and assuredly it
was in this instance, as will be more apparent
hereafter.

CHAPTER VI

MAKING A JOKE OF THE BALLOT-BOX

IN the beginning North Dakota was settled
chiefly from the Middle West, from Iowa,
Illinois, and the like, and by a people seri-
ous-minded, almost painfully conscientious,
hard-working, and abundantly endowed with
the stout virtues of their race. They were pro-
hibitionists on the liquor issue, orthodox in
religion, sturdy supporters of public schools,
and looking upon their political affiliation
as part of their souls' salvation. They
brought to North Dakota the conception
of the Republican party that prevailed in
Iowa after the Civil War when the Repub-
lican majority in the state was eighty thou-
sand and a Democrat was viewed as a child
of sin. They made North Dakota another
Gibraltar for their party; the Democratic
function there was largely of a humorous or
nominal character.

I do not know how, to one that recalls the
Twiddle West of that time, I can give a better
idea of the intensity of the farmers' protest

THE STORY OF THE NONPARTISAN LEAGUE

we are now relating than to recall the fact
that by 1892 the pious allegiance of the typi-
cal North Dakotan to the Republican party
was broken, and broken solely because of the
sense of wrong under which the farmers
labored. The Farmers' Alliance, of historic
fame, was an almost spontaneous uprising
that swept the West from its political moor-
ings. The outraged American had turned
to his natural first weapon. He had organ-
ized a political party to right by legislation
the injustices that oppressed him. Reorgan-
ized into the People's party (quickly changed
in common speech into the Populists) this
movement once attained to six or seven
Senators and a score of Representatives in
Congress. In the presidential election of
1892 it achieved what no other third party
had done since 18GO. It won for its candidate
for President electoral votes in six states and
caused many a shrewd political observer to
stare and mutter. The hopes that it aroused
among the farmers were soon disappointed;
the absorption of the People's party into
the Democratic party in 1896 brought this
chapter of our political history to an untimely
end; and nothing was left to the complain-
ing farmer but some acrid memories and a
lesson.

This was not new, but pertinent. It was to
the effect that in this country little can be

96

THE BALLOT-BOX AS A JOKE

gained or hoped from a third party in the
political field. Many other persons before
and since have run headlong against the same
stony fact. The people of the United States
have settled into the political habit of two
parties; nothing has yet appeared powerful
enough to turn them in appreciable numbers
from this practice, and in our time nothing
so equipped is likely. Yet even the Farmers'
Alliance was not the first futile lunge of the
oppressed agriculturists to get their own po-
litical machinery. When the Grange first
became formidable in Iowa in 1873 its enthu-
siastic members made a party of it and car-
ried the state, to the sound of much rejoicing.
But the Grange, though excellent in other
ways, was never fitted for such activities and
two years later the net result of the Grange
party was the memory of its well-meant laws
that had been repealed and the echoes of loud
vituperation from the Eastern press. The
railroads had rallied and regained their accus-
tomed sway over the affairs of the state, a
sway destined to endure for many years in
Iowa, as in all the West, as the strangest of
all examples of a practical working autocracy
in the midst of a republic.

In the East the Populist movement was met
with a barrage of ridicule that in the end made
the very name a synonym for a political
madhouse. A thousand cartoons represent-

97

THE STORY OF THE NOXPARTISAN LEAGUE

ing the typical Populist as a wild-eyed, long-
bearded, and unkempt maniac formed in the
public mind a distinct, indelible picture
answerable to this weird conception. There
was nothing in the Populist platform pro-
gram that to-day any reasoning man would
regard as extravagant or more than the
moderate expression of a sane conviction;
but the movement was largely laughed
out of court. The East, having before i
always the cartoons and the merry quips of
the paragrapher, would have none of it and
the reflex of all the ridicule worked in time
its full effect even in the West. \Ve might
well pause to remark this, for the enemies of
the movement that thus compassed its down-
fall were the Interests that it threatened, and
the way it threatened them was that it prom-
ised to unseat them from the enjoyment of
illegitimate privilege. Hence the cartoons;
hence the funny paragraphs; hence the pur-
chased ridicule. There was nothing really
funny about a man that sweated from sunrise
to sunset at the hardest of all labor and saw
the fruits of his work snatched from his grasp
by those that worked not nor contributed to
mankind anything more than their gracious
presence, but the genius of hired humor could
clothe even this pathos in a comic garb.

After the collapse of the Populist move-
ment in North Dakota the old political

98

THE BALLOT-BOX AS A JOKE

system resumed its functions. The railroads,
the great financial interests, the mills, the
elevators, and the tremendous power of the
Minneapolis Chamber of Commerce worked
together in happy accord to maintain that
system and extend it. The railroads alone
would have been enough to rule the state as
the Great Mogul ruled India. They had
a political organization better than that of
any party. In every county they had their
machine erected, articulated, faultlessly work-
ing. Farmers, shippers, merchants — the
whole community — lived under the railroads*
rod. Let the laws of the nation say what
they might, the fact always remained that
the railroad in the West dominated the social
organization. Punishment and rewards, and
both unlimited, lay in that power. Farmers
that made bold to displease this autocrat
found they could not get cars for their live
stock or grain; merchants that talked un-
wisely about their rights found their shipments
delayed; independent elevators could get
no side-tracks nor cars. But for all those
that were docile, well-broken, and judiciously
silent the cars came promptly and the ship-
ments suffered no delay, while the nifty
pass was at hand to shed a pleasant afterglow
upon any useful support. The railroads'
political boss, always a clever and usually an
unscrupulous attorney, stood guard in every

8 99

THE STORY OF THE NONPARTISAN LEAGUE

county seat and considerable town. His busi-
ness was to see that the right man was nomi-
nated. To that end he was supplied with
practically illimitable resources, and year in
and year out he knew nothing but success.

Besides money, organization, influence, and
passes, he was provided with another great
asset in the party loyalty at the bottom of
the heart of every average citizen. To keep
the control of the state steadily in the hands
of the ''better elements" he had only to
exercise care about the nominations. So long
as the old system of conventions remained,
his work was of the easiest. All he had to
do was to name the delegates to the township
or county convention and see that they were
of the right stripe, and then the state conven-
tions invariably ratified whatever choice had
been made for the state in the railroad offices
at St. Paul. But the final introduction of
the direct primary (under a pressure that had
become irresistible from the awakened con-
science of the nation) changed all this and
thereafter the railroad agent was driven, on
a much larger and more difficult field, to
manipulate the primaries. One of his chief
cares was to see that no pestilent demagogues
or vile agitators got into the legislature, and so
well was his work done the legislature might
accurately be described as a place of registra-
tion for the decrees of Mr. James J. Hill,

100

THE BALLOT-BOX AS A JOKE

president of the Great Northern and many
other railroad companies, political and com^
mercial autocrat of the Northwest.

But you are to notice as an important fact
that the farmers never acquiesced in these
conditions. As a rule they went to the polls
and voted their party ticket because that was
all they could do, but they never ceased to
protest against the intricate pilferings that
kept them poor and the political system that
kept them in bondage. If you do not like
the way things are going under the rule of
one party, hop across the street and vote for
the other, is the American's recipe for the
healing of the nation. The North Dakotans
tried that, and all that know them will admit
the eloquence of the fact. One year, utterly
wearied of the iniquities of the machine as
operated through the Republicans, they threw
off the yoke and elected as governor an excel-
lent, honest man who was running on the
Democratic ticket. But this good man, once
in office, found himself powerless to make even
a dent on the fortress of existing conditions.
The legislature commanded the situation and
the legislature, because of the careful atten-
tions of the local railroad attorneys, was of
the old type and ever faithful to the cor-
porations.

Meanwhile ingenious minds never ceased

to consider the farmer's lot and suggest

101

THE STORY OF THE NONPARTISAN LEAGUE

remedies. Unbiased thinkers were convinced
that the citadel of the System preying upon
him was the terminal elevator and the termi-
nal market in Minneapolis. Suppose an
elevator and a market operated not for pri-
vate greed, but for the public good, and most
of the farmer's troubles would disappear. The
only power competent to erect and operate
such elevators and such markets was the state.
The state had never done such a thing; there-
fore a certain order of minds familiar in every
community was sure the state never could
do it. Persons not terrorized by tradition
had a different view and the legislature was
besought to take the first step to this form
of relief.

In all the states as in the nation we have
tried to bar the door upon any changes in the
Constitution. We would not say that as to
chemistry, physics, electricity, biology, astron-
omy, geology, ontology, etiology, conchology,
philology, or anthropology the last wrord had
been said in 1787, but when it comes to gov-
ernment, far more important to us than any
of these, we shut ourselves resolutely in the
hermitage of the fathers. It was so in North
Dakota. Instead of allowing the people to
say at once what they wanted to have done
about the Constitution they must live under,
changes in that sacred document must be
reached through long and tortuous ap-

THE BALLOT-BOX AS A JOKE

preaches. It was like a siege; lines of cir-
cumvallation must be drawn, we must have
engineers, bastions, and barbicans, if I have
the military terms right. The legislature
must twice give its solemn approval to the
project and then allow the people to say what
they thought of it.

Most men conceded that if the state was
to go into the business of owning and oper-
ating an elevator the Constitution must be
changed first, so all the outposts, trenches,
and rifle-pits that guarded the Constitution
having been safely passed, at the general
election of 1912, the question was put squarely
to the people of North Dakota whether they
wished or did not wish to have their Con-
stitution amended so that the state could
build terminal elevators outside of the state
boundaries.

On this the vote was:

Yes 56,488

No 18,864

Every county in the state except one voted
in favor of the proposal. The one county
that showed an adverse vote was Mclntosh,
where the population is largely of German
origin and where 279 persons favored the pro-
posal and 679 opposed it.

This would seem to be mandate enougn;
the people had voted three to one in favor of

103

THE STORY OF THE NONPARTISAN LEAGUE

the project. If this is a country where the
majority rules the matter was settled forever.

Nevertheless, the terminal elevator did not
begin to rise according to fond expectation.
The point was urged that while it might be
proper enough under this decision to build
elevators out of the state, there was no kind
of mandate for state elevators within the
state and these were of the only kind that
would avail anything, so we were right back
where we started.

Thereupon the legislature was besieged
again and at the general election of 1914 a
new amendment was submitted authorizing
the state to build and conduct elevators
anywhere, within the state or without it.
On this the vote was:

Yes 51,507

No 18,483

As before, every county in the state voted
;'Yes" except Mclntosh, where 317 persons
voted in favor of the project and 411 against.

Relief was now believed to be in sight. The
people had voted twice. The people rule or
our democracy is a farce. What more could
anybody ask?

At the next session of the legislature an act
was passed levying a special assessment for
the building of the structure the people de-
manded, and the State Board of Control, an

104

THE BALLOT-BOX AS A JOKE

institution that then had charge of all the
state property, was instructed to prepare
the necessary plans.

Nevertheless, the walls of that structure
did not rise. Instead, the Board of Control
spent the assessment in traveling around
the state and in publishing a six-hundred-page
report showing that a terminal elevator was
unnecessary.

To reach this discovery it had summoned
the assistance of mighty minds, and these
quickly showed that when the people voted
twice for terminal elevators they did not
know what they were about. The existing
system provided all the elevation needed and
was, in fact, quite admirable and efficient, if
viewed in the true light. But the legislature
had not aathorized the Board of Control to
seek this advice nor to heed it; the people had
never contemplated any advice taken from
any source. So far as the record went the
board had no shadow of right to do anything
except to prepare plans and start the build-
ing. It did neither, but betook itself to show-
ing, with the aid of outside counsel, how in-
ferior and defective was the judgment of the
people.

And who were these eminent counselors
that thus obliged with wisdom's winged words?

Mr. James J. Hill, Mr. E. P. Wells, Mr.
Julius Barnes.

105

THE STORY OF THE NONPARTISAN LEAGUE

Mr. James J. Hill was at that time the
president of or controlling factor in the Great
Northern, the Northern Pacific, the Chicago,
Burlington £ Quincy, the Colorado Southern,
and other railroads, the greatest power in
Northwestern politics, member of one of the
great controlling groups in the nation's
finance, interested in banks, elevators, and
the maintenance of everything as it was, the
political boss (by reason of his railroad re-
sources) of six states, the man above all other
men that the farmer had to fight at the polls.

Mr. E. P. ^Yells was one of the most promi-
nent and successful operators on the Minne-
apolis Chamber of Commerce, and president
of three institutions that for peculiar reasons
were obnoxious in the minds of the farmers.
These were the Russell-Miller Milling Com-
pany, which operated mills at Minneapolis
and elsewhere through the Northwest, the
Dickey Investment Company, and the Elec-
tric Steel Elevator, a terminal warehouse at
Minneapolis.

Mr. Julius Barnes was a successful oper-
ator on the Duluth Board of Trade and had
much repute as a grain-exporter.

On the advice of these gentlemen, not one
of whom was a resident of North Dakota,
the Board of Control reported that a state
elevator, twice voted for by the people, was
not necessary.

106

THE BALLOT-BOX AS A JOKE

Thereupon the legislature repealed the tax
that had been levied to provide the fund to
build the elevator. Of course, if Mr. Hill
and Mr. Wells and Mr. Barnes said it was
not necessary, what was the use of keeping
the tax?

But the farmers looked upon these develop-
ments without the least enthusiasm for them.
To their simple, untutored minds a vote of
the people was a vote of the people and the
highest law of the land, and they were not
willing to admit that the office of president
of a railroad conferred upon the holder the
privilege of vetoing the verdict of the ballot-
box. On Friday, February 19, 1915, a dele-
gation of them gathered at Bismarck, the
state capital, and petitioned the legislature
that it should proceed to carry out the will
of the voters, twice expressed in the required
American way. By a vote of sixty-four to
forty the House of Representatives refused
to accede to this request and a member,
reporting the facts to the delegation of farmers,
genially advised them to go home and slop
the hogs.

Every farmer in that delegation, every
farmer in the state, knew perfectly well that
at the next general election he would be in-
vited to choose between voting for a candi-
date of the railroads nominated on the ticket
of his party and a candidate of the railroads

THE STORY OF THE NONPARTISAN LEAGUE

nominated on the ticket of the opposition
party, equally controlled. Every farmer in
that delegation, every farmer in the state,
knew perfectly well that the Interests that
rode the state and domineered it laughed at
him and his impotence and believed they
were settled in the seats of power forever.
Every farmer in that delegation, every farmer
in the state, knew that the same Interests
that controlled (and corrupted) the politics
of the Northwest were the Interests that
maintained the fraudulent gradings, the fraud-
ulent scales, the fraudulent tradings bac-k
and forth, the frauds of the mixing-house
and the doctoring bin; that because of these
impositions the farmer was kept poor; that
a part of the money thus wrested from his
grasp was the very money that defeated the
will of the people at the polls and made demo-
cratic government in America a farce. Know-
ing all these things, what then would you
expect?

CHAPTER VII

THE CRUSHING OF THE FARMERS' EXCHANGE

MEANTIME, there had been desperate
efforts to win relief by combinations
and maneuvers on the economic field, no less.
Many acute observers held that this was the
true way to emancipation; for what power
can hope ever to overcome in politics the
resources of great railroads backed by great
banks? But, they argued, when all is said,
the fact remains that the farmer feeds the
nation and in that has a latent power greater
than the power of politics, if he will but use it.
You must understand, of course, that
North Dakota was not the only sufferer from
evil conditions. The whole of Agricultural
Northwest groaned under them. It is very
much the custom to accept at par value both
the reputations and the theories manufactured
for us by a persistent but inspired propa-
ganda. If this informs us for a long enough
time that a certain man is or was a great
"Empire Builder" we accept the good news
with gladness and in the end come to regard

109

THE STORY OF THE NONPARTISAN LEAGUE

the discovery as our own and always with-
out a thought as to the truth of it. Simi-
larly it became in some quarters the custom
to ascribe the growth of the Northwestern
country to the railroads, as if they had put
the fertility into the soil or created mankind's
appetite for bread. The railroads truly
brought the settlers into the region and
took their products out, but the toll exacted
for the service was far beyond its value, was
never expressed in rate sheets and never
really known in its exactions except to those
that toiled under it with heavily bowed
shoulders. What the Northwest would have
been with fair freight charges was the real
consideration but nobody with propaganda
ever exploited that. Why farming was un-
profitable in this prolific region was deemed
a mystery; yet freightage had its due, though
always obscured, place. The farmer planted,
God gave the increase, and excessive railroad
rates, swarming middlemen, and primitive
distribution took up the best of it.

So the economic field became for a time
the favorite adventure, and societies or com-
binations of farmers formed for mutual de-
fense undertook to resist the above dis-
pensation. The histories of some of them
were tragic — a few unselfish men struggling
hopelessly for a cause of the Common Good
against a gigantic and ruthless power that

no

FARMERS' EXCHANGE COLLAPSES

trampled over them and left them crushed
and ruined.

One of these enterprises was the Minnesota
Farmers' Exchange, incorporated in 1903.
A handful of farmers in Clay County, Minne-
sota, was in this situation that each of them
had drudged away the better part of his life,
arising early and laboring late, to face at last
the fact that now, past the middle term of
life, he had nothing to show for it all ex-
cept his two hands and the stretch of prairie
soil with which he had started. The annual
disappointment, it is to be supposed, had
become too much — every year planting the
seed, rearing the harvest in hope and selling
it, as if on a careful calculation, for just so
much as would keep the family alive-. They
read the papers; they knew what dazzling
fortunes other men made out of the farmers'
toil while they that toiled won for themselves
nothing but life on its hardest terms. They
had children growing up around them, and
for these the only promise was a similar life
of hardship and toil for the building of other
men's fortunes.

Day after day they read in their newspapers
reports of the markets upon which were based
the prices they received for their produce, and
could not fail to be instructed by the reading-
accounts like this, of a day on the Minneapolis

Chamber of Commerce, for instance:

111

THE STORY OF THE NONPARTISAN LEAGUE

Chicago quickly turned strong. This firmness
seemed to be due there to scalping operations of the
professionals, and when these stopped buying and
started to sell, the price gave way and dropped 1^
cents in ten minutes.

They read this and they knew that every
time the professional scalpers in Chicago
"stopped buying and started to sell" that
meant just so much out of their pockets if
they tried to sell wheat in Clay County,
Minnesota. Or they noted comments like this :

Strong selling pressure halted a sharp rally in wheat
prices after a steady opening to-day. The market
scored fractional gains a few minutes after the start,
but dropped when bears threw considerable wheat on
the market.

Or this:

Minneapolis December opened % to l}/g stronger
this morning, not because there was anything bullish
in the overnight news, but seemingly either because
sentiment in the pit was bullish or traders were afraid
of the selling side.

Or:

Chicago opened higher, probably because there were
a lot of scared shorts in the market — traders who went
over the holiday short and were alarmed by the
strength here and in Winnipeg yesterday.

Or:

There was no pressure on the Minneapolis market
and traders did not hesitate to buy it on easy spots
caused by the weakness in Chicago.

11*

FARMERS' EXCHANGE COLLAPSES
Or:

As has been said several times in this column of late,
the fluctuations are caused mainly by the operations
of professional traders.

These things they read all the year around
and then contemplated the immensity of the
falsehood that the prices of their produce
were subject to demand and supply or to any
other influence except that of the manipu-
lators and speculators for whose benefit the
farmer arose early and labored late.

These men, moreover, had read books
about the economic struggle elsewhere. They
had read about the great co-operative move-
ment in Europe, the inspiring record of the
Rochdale pioneers, the marvelous story of
life remade for the farmers of Belgium and
Italy by the simple achievement of combining
their forces. They knew that co-operation
had the indorsement of all sociologists as
scientifically sound and humanly useful. It
seemed to them as feasible in Minnesota as
in England or France. Their grain was sold
in a public market chartered by the law of
their state. All that was needed was that
grain should be handled on that market so
as to deliver it straight from producer to
consumer and both would share in the great
saving that would result.

About a dozen of them, impressed with this

113

THE STORY OF THE NONPARTISAX LEAGUE

view, came together, put in a little money,
pledged their credit for a little more and
launched their Farmers' Exchange to market
grain on the co-operative principle.

They believed that on the Minneapolis
Chamber of Commerce they would have the
same right of access as any other persons,
not being able, I suppose, to conceive of a
private public market. They therefore pur-
chased a membership on the Chamber of
Commerce and prepared to do business,
advertising for consignments of grain.

But as soon as they attempted to enter
the Chamber for this purpose they were
astonished to find that their membership was
practically worthless, for it could be annulled
if the directors were pleased to annul it.

They applied to the board of directors for
that body's sanction of the membership they
had bou&. ' A long delay ensued. As to
what happened next I feel I should quote
the sworn testimony, because the story is so
remarkable no mere assertion would seem to
be adequate. The secretary of the Farmers'
Exchange of Minnesota was Mr. George E.
Case of LeSueur County, and under oath
Mr. Case says:

We [the Exchange] asked if we could meet the board
of directors of the Chamber of Commerce. They told
us we could. We asked them to appoint a time, and
they set a time that we could meet the board. We

114

FARMERS' EXCHANGE COLLAPSES

went over there as a board. After meeting — part sat
on one side of the table and part on the other — I think
Mr. Major asked if they objected to the man that
would represent the Farmers' Exchange on the board.
He has a membership [hi the Chamber of Commerce],
They said no, not at all; that he had been there hi
good standing nine or ten years, and they had no ob-
jection to him as a man.

I remarked, "I suppose it is our financial condition,"
and if that were the case, if they would state the
amount of money necessary for us to place in the
treasury so that we would be considered responsible
financially — if they would name that amount, if that
was the objection, if we could not place that amount
in the treasury we would not ask them further for a
seat on the Chamber of Commerce.

They said it was not a question of finance. I said:

If it is not a question of finance or of the man that
represents us on the board [floor of the Chamber]
what is the trouble?

INTERSTATE COMMERCE COMMISSIONER PROUTY. —
What did they reply to that?

MR. CASE. — I have not had a reply.

MR. MARBLE (counsel for the Interstate Commerce
Commission). — You have not yet succeeded hi getting
that membership?

MR. CASE. — No sir.

MR. MARBLE. — Is it practicable for you to sell cash
grain in this market without selling it through the
Chamber of Commerce?

MR. CASE. — No.

MR. KOON (of counsel for the Chamber of Com-
merce).— Is it not a fact, Mr. Case, that your institu-
tion to-day is bankrupt, that you have lost your
capital?

THE STORY OF THE NONPARTISAN LEAGUE

COMMISSIONER PROUTT. — I do not think we will re-
quire Mr. Case to answer that question unless he
wants to.

MR. CASE. — I will state this, your Honor, that if we
had the money placed in our treasury that was taken
out of there to pay for grain that was turned into the
Chamber of Commerce (and we did not get our money
back), we would be in much better shape.

MR. Koox. — You mean commissions, Mr. Case?

MR. CASE. — No. Grain turned in to members of
the Chamber of Commerce and we did not get our
money back.

MR. Koox. — Somebody was a defaulter?

MR. CASE. — I state the case. You may draw your
inferences.1

The farmers never received any answer to
Mr. Case's question. No response was made
to the proposal to deposit any given amount
as security, no statement of any reason why
farmers should not be admitted to a market
where they sold all their produce. But after
a long time they received this illuminating
epistle:

CHAMBER OF COMMERCE,
MINNEAPOLIS, MINN.,

July 18, 1905
MR. L. K. KEYERS,

Secretary, Minnesota Farmers' Exchange,
Corn Exchange Building, City.

DEAR SIR, — Your application for corporate mem-
bership for the Minnesota Farmers' Exchange was
considered by the board of directors of the Chamber

1 Before the Interstate Commerce Commission. In re Relations
of Common Carriers to the Grain Trade; testimony, p. 998.

11G

FARMERS' EXCHANGE COLLAPSES

of Commerce of Minneapolis at a meeting yesterday,
July 17, 1905, and the application was not granted.
Yours truly,

G. D. ROGERS,

Secretary.1

This is all the information on the subject
ever officially vouchsafed to the farmers.
A disapproval of a membership was almost
unknown in the history of the Chamber.
Why was it recorded in this case? If the seat
had been transferred from one broker to
another, or from a broker to a firm, a cor-
poration, or milling company, however new
or of whatsoever shady repute, there would
have been, in all probability, no hesitation
about it. Such things had been done time
and again. As to why there was objection
in this instance, when all the farmers backing
the Exchange were well known to be responsi-
ble and of good standing and when they offered
to make a deposit to cover any possible loss,
the directors remained mute. It was doubt-
less as well that they did, for on the floor of
the Chamber no mystery was made of the
affair. The farmers were excluded from the
market, where their own grain was sold, be-
cause they were trying to do business on
the co-operative basis and for the Common
Good, and the brokers saw in that a threat
against their privileges and goodly takings.

1 Before the Interstate Commerce Commission. In re Relations
of Common Carriers to the Grain Trade; testimony, p. 993.

117

THE STORY OF THE NONP ARTISAN LEAGUE

But there is still another story here. " Some-
body was a defaulter," says Mr. Koon, in-
cautiously. As to who did the defaulting
there is other testimony available of which
Mr. Koon at that time was not aware.

When its application had at last been turned
down by the management of this strange
kind of public market, the Farmers' Exchange
was driven to seek another w^ay to dispose
of the wheat that was being shipped to it
by the growers in the country. So it made
an arrangement with a firm of regular brokers,
McKinnon & Son, to take this business on
the usual commission basis.

Very soon afterward McKinnon & Son,
though apparently in sound condition wyhen
the arrangement was made, suddenly failed.
Nobody seemed to know exactly why they
should fail, and the news caused much aston-
ishment in some quarters. The firm was
immediately succeeded in the Chamber by
another firm with which the Farmers' Ex-
change had no arrangement. Among the
consignments of grain to the Farmers' Ex-
change was one of twelve cars that it had
handed over to McKinnon £ Son before the
failure. The new firm refused to release
these, and neither the Farmers' Exchange
nor the shippers of the grain, who were its
lawful and true owners, could ever recover
it or get paid for it. The Chamber of Com-

118

FARMERS' EXCHANGE COLLAPSES

merce had many rules, some of which were
supposed to enforce fair dealing and equity.
It was also, by statutory enactment, a part
of the judicial machinery of the state of
Minnesota, and therefore under a peculiar
obligation to support justice. Yet in this
case it steadily refused to support justice or
to uphold righteousness, and the directors of
the Farmers' Exchange were left to pay for
the twelve cars of wheat that had been
taken from them, approximately $12,000.
Some of the victims went into debt and mort-
gaged their possessions to make the amount
good. That was the end of the Farmers'
Exchange and of this phase of the grain-
growers' effort to win free from the thing
that oppressed and impoverished them.

"Somebody was a defaulter," said the in-
judicious Mr. Koon. Not much doubt of
that now, for the wrhole significant story
came out before the committee of the Min-
nesota House of Representatives that in 1913
was investigating the grain trade, and some
of the testimony is so important that I will
quote it in full. The witness is one of the
farmers that were stung in the way I have
described:

Question. — Your society or exchange brought the
matter right up to the Chamber of Commerce?

Answer. — Yes sir. I studied this organic act [of the
Chamber] and their laws and regulations and thought

119

THE STORY OF THE NONPARTISAN LEAGUE

to myself, if they were sincere in their motives and
wanted to follow out the principles they would possibly
assist us to get this wheat paid for to the original
shipper, and in order to give them that opportunity I
took it up with the Chamber of Commerce by corre-
spondence and explained to them the situation to lend
us a helping hand. We had several letters with them
and they staved it off.

Q. — Did the Chamber of Commerce ever attempt to
right the wrong of the transaction which you have
stated to the committee?

A. — No, they have not.

Q. — What further was done, if anything? Did the
farmers ever get paid for their wheat?

A. — Yes; there were nine directors of us and eight
of us put up $1,500 each to pay for the wheat. The
directors paid the farmers for the wheat.

Q. — The farmers' corporation — it broke them?

A. — Yes sir.1

Farther on in the same investigation the
same witness was on the stand, and this
occurred :

Question. — Do you at the present time, Mr. Steen-
erson, consider it obligatory upon the Chamber of
Commerce to pay this debt?

Answer. — Morally, they ought to pay it.

An attorney for the Chamber of Commerce
was present and bristled up at this. He said :

Question. — Do you want this committee to under-
stand that you think the Chamber of Commerce should
pay it?

1 Investigation of Grain Exchanges; House of Representatives of
Minnesota; testimony, pp.

FARMERS' EXCHANGE COLLAPSES

Answer. — I certainly do.

Q. — Do you know what kind of an organization the
Chamber is?

A. — I think so.

Q. — You do not mean to say you think the Chamber
got this money itself?

A. — Through their instrumentality Mr. Welch got
the money. Your system and the manifold ways of
doing business fixed it so Welch & Co. swindled the
farmers out of twenty-six carloads of grain.

Q. — How long have you been thinking this over? Do
you want this committee to believe that you are not
willing to try it out in court and although the Chamber
did not get this grain you want them to pay for it?

A. — I want this committee to believe that I wanted
the Chamber of Commerce to understand the situation,
so they could, if they saw fit, make their members
make restitution to these people who had shipped this
grain. I submitted the case as plainly as I could to
them and they declined to do so, and that is all so far
as I am concerned.

Q. — You are willing to have it appear in record that
you think the Chamber of Commerce owes this debt?

A. — I still hold that they are morally responsible
and should make restitution, either themselves or those
that got the money.

Q. — You never looked into this yourself?

A. — I have.

Q. — And you were not willing to have that instru-
mentality [the Board of Arbitration of the Chamber
of Commerce] arbitrate the dispute?

A. — If an outsider were to submit to any agreement
to arbitrate matters of this kind with a member, he
would have no chance whatever before a Board of
Arbitrators composed of members of the Chamber. If
members would live up to the by-laws and rules they

121

THE STORY OF THE NONPARTISAN LEAGUE

could adjust matters between your members and the
outside, but they consider outsiders proper subjects
to be fleeced. That is the way you are transacting
your business and that is what you got your organiza-
tion to do, and it is a shame upon the state of Minne-
sota that you are permitted, under any law, to carry
on such a nefarious scheme to maintain their charter.

Q. — Was the Board of Arbitrators explained to you?

A. — I read the Articles of Incorporation and the
rules of the Chamber of Commerce, and in one of the
rules it said the members will not be required to in-
criminate themselves in case there is a hearing, which,
of course, is the right we are entitled to. When we
are in court we take that right, but for you people to
prescribe that you shall have the right to refuse to
answer questions shows in itself that you are trying to
shield rascals.1

Neither the officers of the Chamber nor
their astute counsel seemed to have any pat
answer to this outburst, which sounds still in
the testimony with the note of rugged honesty.
15 ut that did not save the Farmers' Exchange,
which was beaten down and ruined for this
only reason that it purposed to distribute
among the producers some part of the profits
then being seized by persons having no part
in cither production or distribution, but en-
dowed by reason of those profits with abnor-
mal and illegitimate power.

1 Testimony before Minnesota Hou.se Committee, pp. 753-754.

CHAPTER VIII

UNEQUAL FIGHTS ON MANY FIELDS

CO-OPERATION as a remedy for the farm-
er's troubles was nothing new when the
Farmers' Exchange began its disastrous career.
The Exchange was, in fact, only one in a long
series of experiments, mostly futile, with a
principle that abroad had proved an illimit-
able boon to both producer and consumer.
So far back as 1889, when the losses through
false grading and other ill conditions were
growing to their worst, co-operation had been
approved to such an extent that in many
communities "farmers' elevators," conceived
and operated on the co-operative principle or
pretending it, had begun to break into the
grain business. By that time the "line" ele-
vator was developing into the iron-fisted con-
trol of the farmers' market it afterward at-
tained, and the appearance of the co-operative
elevator in competition with this was not
viewed with rapture, as one can readily under-
stand, on the Chamber of Commerce.

The "line" elevators all acted together, as
I have indicated in the stor of John Evans,

THE STORY OF THE NONPARTISAN LEAGUE

and so long as they had the field to themselves
could fix what prices and conditions they
pleased. There might be three or even four
elevators at the same station, all bearing
names of different suggestions of lordliness—
''Majestic," "Atlantic," "Great Western,"
and the like — but all, as a rule, were of the
"line" order, were owned by some corpora-
tion or firm on the Minneapolis Chamber,
and acted in concert, though by a useful
fiction they were supposed to compete. A
genuinely co-operative elevator in any of
these places was a grave menace to this
established and highly successful business,
not merely because the profits under the co-
operative system were distributed among
the farmer owners, but because the farmers'
elevator was free to pay approximately what
the wheat was worth.

The co-operative elevator began to spread
rapidly. To meet it the "line" companies
adopted effective tactics.

1. Being interlocked with the directorates
of the great banks of the Northwest, the great
banks of the Northwest being interlocked
with the great financial interests of the coun-
try and the great financial interests of the
country, of course, controlling the railroads,
it was easy to induce the railroad manage-
ments to refuse to a farmers' co-operative
elevator association a site on the companies'

UNEQUAL FIGHTS

right of way or owned land. This did not
always meet the requirements of the "line"
companies, because the railroad's right of
way was not always wide enough to exclude
the farmers or there might be a piece of land
adjacent thereto that could be had from some
other owner than the railroad company. Still
there is no question that in many instances it
was a good device and prevented the organiza-
tion of many a farmers' elevator concern.

2. If in spite of the railroads' active opposi-
tion the farmers succeeded in getting their
site and in building their elevator, it was
always feasible to refuse (or to fail) to provide
such an elevator with cars.

This is a delicate maneuver against which
there is no perfect remedy so long as the rail-
roads are in the hands of private companies.
The legislature may enact, Interstate Com-
merce Commissions may order; there will
always be room for a manipulation not to be de-
tected. The farmers' elevator and the "line"
elevator lie side by side.1 Both want cars to

1 Records in the possession of the farmers' organization contain
many such instances supported by investigation. I recall one
flagrant case, noted in October, 1915, where at a North Dakota
station a co-operative farmers' elevator and a "line" elevator occu-
pied adjoining sites on the same side-track. The co-operative ele-
rator, after days of frantic appealing to the railroad company for
cars, had been obliged to close with its bins full of grain. The " line"
elevator had no grain stored in it, but was daily shipping out full
cars and had three empties waiting for it on the side-track. It is
necessary to know these things and their multiplicity to understand
why the farmers were so bitter.

125

THE STORY OF THE NONPARTISAN LEAGUE

ship away the grain that is accumulating with-
in them; both apply to the railroad company.
If the "line" elevator gets the cars and the
farmers' does not, who is to prove that the
request of the "line" elevator was not in
first? And if thereby the farmers' elevator
becomes choked with grain so that it can buy
no more, and the whole situation passes into
the hands of the "line" elevator, which can
now pay what price it pleases and exact what
dockage it may elect, who is to say that the
railroad company is at fault? Cars are hard
to get at the season when the wheat is moving ;
every railroad company is put to its utmost
of ingenuity to meet the demands made upon
it. First come, first served, according to its
managers and press agents, is its rule, and if
the "line" people were smart enough to dis-
tance the farmers about car applications, that
is no concern of the company's. Something
like this is the ready answer to every com-
plaint, and there is no way to refute it.

3. They organized the local banks against
the co-operative and thereby let loose a tre-
mendous power. Far too little has been said
about this phase of rural life in America.
Taking the country by and large, the power
of the bank is second only to the power of
the press, and, so far as mere newspaper edi-
torials are concerned, goes immeasurably in
advance. I should think it no exaggeration

1*6

UNEQUAL FIGHTS

to say that the political and business potency
of the small banks in North Dakota alone
was greater than that of all the newspaper
editorials in the United States. The banks
hold (or used to hold) over the farmer the
power of life and death. They could for any
reason or none withhold the money supply
by which alone he could continue to operate.
To stand well with the local banker became,
therefore, a matter of the first importance
to the average farmer, and when in any com-
munity a project to build a co-operative ele-
vator was broached, and the local bankers
were against it, the project usually failed in
that community.

If it were built, nevertheless, and the
banker remained hostile, he could so manage
his great influence that many a farmer, even
if he held stock in the enterprise, dare not sell
his grain to it. "If I were you I'd sell my
grain to the Majestic people; they give you
the fairest price, and then, you know, they are
absolutely trustworthy, and you don't know
about the others." Thousands of times exactly
that significant hint has fallen from the lips
of the town banker and often it has been
effective in ruining a co-operative enterprise.

4. In many places the fraudulent co-opera-
tive elevator was found the most useful de-
vice. If there came word that in this town
or that the farmers were uneasy, and much

1*7

THE STORY OP THE NONPARTISAN LEAGUE

talk was heard that they ought to unite for
their own welfare and protection, it was not
long before a brand-new structure bearing
the conspicuous legend, "Farmers' Elevator
of Lumtiloo," would arise in that place. Or
a "line" elevator would be sold and the
painters' handiwork would transform it in an
hour into an enterprise apparently enlisted
under the co-operative banner. The real
owners were sometimes a Chamber of Com-
merce firm and sometimes a local company
that the local banker had obediently fathered ;
but in either case it had nothing to do with
co-operation, and the only sense in which it
could be said to be a "farmers' elevator''
was that it existed to outwit them.

The natural surmise would be that this de-
vice was too far-fetched to be common. On
the contrary, it was the commonest of all the
means whereby the Chamber of Commerce
firms fought the co-operative wave, and so
lately as January, 1916, there were in North
Dakota 350 elevators that pretended to be
co-operative and were not so to 50 that were
genuine. So far had the business of estab-
lishing and maintaining this disguise gone
that there was published a periodical that,
bearing a co-operative name and ostensibly
devoted to the co-operative interest, was in
reality printed only to prevent co-operation
by discouraging it.

128

UNEQUAL FIGHTS

5. To secure by bribery or purchase the
secret assistance of the manager of the co-
operative elevator that he should ship the
grain to certain houses and thus maintain
the supremacy of the existing system; or to
buy a good manager away from his employ-
ment.

The prevailing bonus or bribe (as you pre-
fer) was five dollars a car for each car diverted
from co-operative to regular commission chan-
nels. Where a brutally frank tariff like this
seemed for some reason inadvisable, or the
man they wanted was too honest to be bought,
the "line" company would lend money to
him or bestow upon him other advantages of
a tangible nature.1 These transactions be-
came finally so much of an obstacle that the
Equity, which is the name of the greatest
and most efficient of these farmers' co-opera-
tive societies in the Northwest, was driven
to adopt one settled policy in relation thereto.
Whenever it learned that in any locality the

1 Before a committee of the House of Representatives, Legislature
of Minnesota, investigating grain exchanges. Testimony of A.
Kuenig, who had been manager of a farmers' elevator at Garretson,
North Dakota.

Question, — Did you borrow money from them?

Answer. — Yes sir.

Q.— I say, then, it was the loaning of money to you by Stair,
Christcnson & Timmerman and by Van Dusen-Harrington that
took you away from the Equity Society in the matter of handling
your grain, wasn't it?

A. — Yes sir.

In the end the practice was admitted by Mr. Lind, counsel for the
commission men. Testimony, vol. vi, p. 1,688.

THE STORY OF THE NONPARTISAN LEAGUE

farmers desired a co-operative elevator the
Equity sent to the spot and built one, and
thereafter retained it under its own manage-
ment that it might know there was no chance
for these devices.

6. To hamper, harass, undermine, dis-
credit, and if possible destroy the co-operative
societies wherever they appeared.

This is a long story and not reassuring.
The principal sufferer from these tactics has
been the Equity, which may be said to have
survived and advanced only by reason of the
sheer dogged tenacity of a handful of aroused
Americans that would not know when they
were beaten. The career of the Equity has
been one record of incessant fighting. It has
been dragged into court on a variety of
charges, all subsequently proved to be without
foundation, attacked through the press and
attacked through the banks. More than once
it has seemed to be on the point of extinction
and still it has gone on growing in strength
and the scope of its operations. From the
long list of its struggles for the right to live
I will cite one that will serve as an illustration
for the rest.

In 1911 it organized the Equity Co-opera-
tive Exchange, undismayed by the fate of
the Minnesota farmers' experiment, and be-
gan to try to do business by receiving grain
from the growers and selling it on the Minne-

130

UNEQUAL FIGHTS

apolis market. In other words, its function
was that of the grain broker, only honestly
performed, and it cut out the "wash" sales
and the mysterious medicaments of the ter-
minal elevator.

To do this modest amount of business it
must operate through the Minneapolis Cham-
ber of Commerce, and I need not dwell on
the fact that it was there a most unpopular
institution. It did business on the co-opera-
tive basis and not for profits, always a deadly
fault in the view of the Chamber.

In August, 1914, a stockholder in the
Equity was induced to bring suit to have
the books and papers of the concern exam-
ined. The money that paid for this examina-
tion was said to come from the Chamber of
Commerce — at least it was a paid accountant
of the Chamber that made the examination.
He reported the Equity to be insolvent. The
then attorney-general of North Dakota filed
a petition alleging insolvency, fraudulent
transactions, and the like, and asking the
court to enjoin the officers and appoint a re-
ceiver. \Vith two or three exceptions all of
the affiants in these proceedings were mem-
bers of the Chamber of Commerce or in the
employ of members. When the case came to
be heard the court decided in favor of the
Equity, gave it a clean bill, and the attorney-
general's suit was dismissed.
"

THE STORY OF THE NONTARTISAN LEAGUE

The Equity was still unable to do any busi-
ness on the Chamber, although that institu-
tion was of a public nature and part of the
state's judicial system, but it got state in-
spection for its wheat and tried to sell grain
to four of the great mills of Minneapolis.
None of them would touch it, and not a bushel
of Equity wheat was ever bought by a Minne-
apolis mill.

A new blow now fell upon it from an un-
expected quarter. There is between Minne-
apolis and St. Paul a great switching-ground
and freight-car clearing-house called Minne-
sota Transfer. It is operated by all the rail-
roads in common; it is a public utility if there
is one in America. The Equity was now re-
ceiving much grain in carload lots and was
selling it to Eastern mills and shippers. Of
a sudden Minnesota Transfer notified it that
thereafter no Equity cars shipped in from
a point on one railroad would be forwarded
to any point on any other railroad.

This meant that in every Equity shipment
the grain must be taken from the car in which
it arrived and transferred to another car.
Only an elevator could do this work; the
Equity had no elevator, and none of the ele-
vators in that region would touch a bushel of
Equity grain. At one blow, therefore, the
railroads had put the Equity out of business.

In this emergency appeal was made to the

132

UNEQUAL FIGHTS

Interstate Commerce Commission, and the
late John H. Marble, then a member of the
commission, issued an order that compelled
the railroads to handle the Equity cars as they
handled all others.1

Yet often the farmers came to think that
all government, state, national, and munici-
pal, was lined up against them. In January,
1914, a grain-growers' convention was held
at Fargo, North Dakota, under the auspices
of the Equity Society. As may be imagined,
the trend of the speeches was not compliment-
ary to the existing system of grain-handling.
The meetings were held in the Fargo Audi-
torium, which seats more than four thousand
persons and was crowded. The projectors of
the meetings had secured, as they thought,
the hall for every day and evening of the
session. On the last evening a body of men
representing the Minneapolis Chamber of
Commerce suddenly appeared with a posse of
police, and asserted that they had hired the
hall for the purpose of holding a meeting to
urge the other side of the grain question.
The farmers exhibited their papers showing
their lease of the premises, but the other
party insisted and the police began with un-
necessary roughness to throw the farmers'
speakers that were on the stage into the

1 Before the Committee on Rules, House of Represertatives, Sixty-
third Congress, Second Session, p. 4£4.

133

THE STORY OF THE XOXPARTISAX LEAGUE'

street. Mr. J. M. Anderson, the president of
the Equity, protested to the chief of police,
who was present, but was threatened with
arrest and manhandling if he did not keep
still. The enraged farmers in the audience,
when they understood what was happening,
started for the stage, and but for the coolness
and restraining influence of Mr. Anderson a
battle would have followed, with bloodshed
and possible loss of life. Mr. Anderson finally
induced the farmers to yield, under protest
and pressure, and the meeting was broken up
by the authority and connivance of the gov-
ernment of Fargo.

In spite of every obstacle, ingenious or
merely brutal, the Equity went on. I have
not known a more gallant fight against heavy
odds; the fidelity with which its officers and
members stuck to it through the darkest days
is not less than heroic. The men that carried
it through will never be celebrated by the
trump of fame, but they gave, nevertheless, as
worthy exhibitions of steadfast moral courage
as are ever shown on a battle-field.

Every month now it was handling more
and more of the farmers' grain. To handle
grain it must have banking accommodations
because it must meet sight drafts made on the
grain it received, but it must wait for payment
for the grain it sold.

Now the backers of the Equity are the

UNEQUAL FIGHTS

farmers of the Northwest. At the time I am
writing of, four thousand of these had pledged
themselves and all their means in support of
the enterprise; its managers were all farmers
of substance and standing. Nevertheless, in
exact proportion to the increase of its receipts
increased also the difficulty of getting bank-
ing accommodations. The active field man-
ager of the Equity was George S. Loftus,
whose remarkable career and unselfish sacri-
fices for the public have never been sufficiently
told. He had been a prosperous hay and feed
dealer in St. Paul when a conception of the
struggle of the people against monopoly and
privilege laid hold upon him with an apostolic
inspiration, and he abandoned his business
and every personal consideration to give him-
self to a cause that cost him his life.1 His
first achievement was a successful campaign
he inaugurated and carried on against the
Pullman Sleeping Car Company to compel it
to lower the rates for upper berths. He car-
ried this through the Interstate Commerce
Commission and the courts, and the country
owes to him the 20-per-cent. reduction it has
ever since enjoyed.

When the Equity started upon its fight
against the existing system of marketing
grain, Mr. Loftus gave himself wholly to the

1 He (lied in WIG of an illness brought on by his labors and anxieties
in the farmers' cause.

THE STORY OF THE NOXPARTISAN LEAGUE

conflict, toured the country, addressing great
meetings of farmers, and finally accepted at
a merely nominal salary the position of sales
manager at Minneapolis. It was his duty to
get these banking accommodations, and his
distress grew with the tightening band the
banks were weaving about his institution.

As fast as one bank refused the Equity
account Mr. Loftus must chase about the city
until he found another willing to accept it.
At last only one bank stood between him and
ruin, and one day the cashier of that bank
called him into the office, and with expres-
sions of regret and personal esteem told him
that instructions had been issued that^the
Equity was to have no more credit there.

Mr. Loftus went back to his headquarters,
his mind in a whirl. There seemed nothing
to do but to announce the closing of the
Equity and try to settle with the farmers for
what grain was then in transit. After so long
and brave a fight defeat had come at last.

" What did you do, George? " asked a friend,
afterward.

"I will tell you what I did," said Mr. Loftus.
"I am not much in the piety line, but I went
into my office and shut the door and kneeled
down and prayed. When I got up I happened
to think of an old friend of mine in a bank in
St. Paul. I went straight there to see him.
I used to get credit at that bank when I was

UNEQUAL FIGHTS

in business for myself in St. Paul and they
knew I was all right. Nevertheless, I went
with my heart in my mouth. It did not seem
possible that anything could save us. But I
went in and told my friend how I was fixed,
and he said, ' Certainly, George, you can have
what you need.' '

By such a narrow margin was the enter-
prise saved from the rocks. After a time the
St. Paul banks grew rusty, and one after
another refused the business. The Exchange,
practically driven out of Minneapolis by the
influence of the Chamber, meantime had
moved to St. Paul. It occurred to some of
the keen merchants there that it would prob-
ably develop into a valuable asset. Already
it was talking about a co-operative elevator
to be built in the city. These merchants put
a pressure upon any bank that was likely to
prove hostile, and again the Equity moved
forward.

With its development increased also the
hatred it had aroused as an institution not
conducted for profits. It wras now assailed
with a charge that must be fought clear to
the legislature of Minnesota, the Congress of
the United States, and the state courts, that
the Equity was not a genuine business enter-
prise, but tricked farmers to ship it grain,
which it turned over, while in transit, to
Chamber of Commerce brokerage houses, and

THE STORY OF THE NONPARTISAN LEAGUE

thus compelled the farmer to pay in effect
two commissions. To support this charge a
certain list of cars was shown that had been
started to the Equity and re-routed to Cham-
ber of Commerce firms. The explanation was
that in some instances these firms, for their
own purposes, had bought the wheat at the
Equity prices, and in other cases the thing
happened because changing market conditions
after the wheat had been shipped justified a
change in the original destination. But the
point to be made here is the exceeding bitter-
ness with which these charges, essentially
trivial, were urged. It is a fact easily verified
by reference to the newspapers that the
managers of the Equity were assailed as if
they had committed some form of loathsome
crime, and the Northwest was flooded with
circulars, pamphlets, and clippings from the
press, informing the grain-growers that the
Equity was a swindling concern, and any farm-
er that shipped to it must be prepared for dou-
ble commissions, vexatious delays, and prob-
able loss.

It was against such odds that the Equity,
existing not for gain, but to secure bare jus-
tice and uphold basic rights, must fight every
instant for its life.

At the same time other states, and even
Canada, were furnishing convincing examples
of the tremendous power that the farmers

UNEQUAL FIGHTS

must combat if they were to win to a measure
of freedom.

The farmers of Manitoba, who suffered in
a less degree from such conditions as made
farming unprofitable in North Dakota, united
to form the Grain Growers' Grain Company, a
purely co-operative concern, to handle on the
Winnipeg market the produce of its members.
It sought a seat on the Winnipeg Exchange,
which is for Manitoba what the Chamber of
Commerce is for our Northwest. The seat
was finally obtained for twenty-five hundred
dollars, and the farmers, having it, were able
to do business on the Exchange — for the space
of one week. Then incontinently and without
other proceedings they were ejected from the
place. Whereupon the banks made war upon
it and the grain-dealers refused to handle its
grain. The farmers did not tamely submit to
this, but took the matter first into the courts.
Mr. John J. McHugh was at that time secre-
tary of the Minneapolis Chamber of Com-
merce and a member of the Winnipeg Ex-
change. He and others were indicted 1 for
conspiracy in connection with the ejection of

1 MR. CANTRTLL. — You say he was indicted. Was he convicted?

MR. DRAKE. — lie was not convicted.

MR. CANTRILX. — He was acquitted?

MR. DRAKE. — I do not know whether he was acquitted or nou. . . .
It is my understanding that after the restoration of the Grain
Growers' Grain Company to the Board of Trade in the manner I
have outlined, the charges against McHugh were dropped. — Hearing
before Rides Committee, National House of Representatives, Sixty-tliird
Congress. Testimony of Benjamin Drake.

131)

THE STORY OF THE NONPARTISAN LEAGUE

the farmers. But meantime the Grain Grow-
ers' Grain Company was no nearer to a chance
to do business, no matter how illegal or unjust
might have been its expulsion. It therefore
appealed to the provincial government of
Manitoba, which, after a time, ordered the
farmers' company to be reinstated on the
Exchange. But here comes the strangest
part of the story, for although the govern-
ment's order, one might think, was one to
be obeyed in its letter and spirit, and obeyed
promptly, the Exchange succeeded in holding
off the matter until it had compelled the plan
of the Grain Growers' Grain Company to be
changed so that the co-operative feature was
eliminated. AYhereupon, being not different
from other corporations that did business for
profits, the Exchange no longer had objection
to it.

The farmers of North Dakota knew well
the course of these combats and the finis! i
thereof, and did not fail to appraise rightly
the lesson of colossal and absolute power.
They now had another object-lesson nearer
home.

The wheat markets of the United States
are Minneapolis, Chicago, and Dululli. Min-
neapolis overshadows these, for Chicago's in-
terest is speculative, having the wheel of fort-
une on which grain bets are made by the
whole country; and Duluth, while a busy

140

UNEQUAL FIGHTS

shipping port in the summer, is closed to
navigation about half of the year.

Nevertheless, you can ship wheat to Du-
luth in the fall or winter and have it stored
against spring, when it usually goes by boat
up the Great Lakes. Minneapolis market
conditions having been made thoroughly un-
satisfactory to the farmers, there was hope,
when Duluth began to loom into importance,
that the once favorite dream of competition's
beneficent influence might be realized here.
This hope, when put to the test, failed like
the rest, partly for such reasons as in these
days usually cause competition to fail every-
where, and partly because members of the
Minneapolis Chamber of Commerce went to
Duluth, secured control of its Board of Trade,
and instituted there the methods to which
they had l>een accustomed.

Duluth lies close to the Wisconsin line, and
on the other side of that line, across the har-
bor, is the city of Superior, Wisconsin, which,
having an excellent water-front and good
shipping facilities, is something of a rival to
Duluth. The Chamber of Commerce com-
bination had a firm hold upon the govern-
ment and legal machinery of Minnesota.
The railroads and banks, working with the
Chamber of Commerce, had a firm hold upon
the government and legal machinery of North
Dakota. In Wisconsin, revolt against the

ui

THE STORY OF THE XONPARTISAN LEAGUE

domination of the corporations had gone on
for some years, and with such success that
they no longer had a firm hold upon any
government or legal machinery there. The
harassed North Dakota grain-growers, there-
fore, were driven to a most unusual step.
They went to the legislature of Wisconsin for
relief through the Wisconsin port of Superior,
and they obtained a law by which the Wiscon-
sin Grain and Warehouse Commission was
made to consist of three persons, one from
Wisconsin, one from New York, and one from
North Dakota.

The value of this provision lay in the fact
that the Grain and Warehouse Commission
appointed all the inspectors and weighers of
grain in the state and could insist that grain
grading and weighing be fair and just; and
on the commission thus empowered the
North Dakota farmers had representation.

Superior had a growing grain exchange and
a growing Lake traffic, and the North Dakota
farmers began to ship their grain to Superior
and get the benefit of honest grades. Not
long did the good days last. From the report
of the committee of North Dakota bankers
that I have previously mentioned I take this
succinct statement:

Our shippers wore undoubtedly greatly benefited dur-
ing the time the Wisconsin inspection was in force, but
by the apparent combined efforts of the Interests ajbove

112

UNEQUAL FIGHTS

named this Wisconsin inspection is superseded, and all
grain received at the head of the Lakes must be inspected
by Minnesota inspectors under Minnesota rules.

Who were "the Interests above named,"
and how did they do this amazing thing, the
nullifying of the law of a sovereign state?
One would think it impossible. On these
mysteries the report of the North Dakota
committee sheds the needed light. It says:

The story of how the Wisconsin law was made ab-
solutely inoperative is an interesting one. The Du-
luth Board of Trade made a rule that no member of
the Duluth Board could hold membership in a similar
organization within a hundred miles of Duluth.1 This

1 I think I had better illustrate tins from the regulations of the
Duluth Board of Trade, otherwise readers unfamiliar with the ex-
cesses in autocracy that undisturbed monopoly had bred in the grain
business may think the committee's comment unjustifiable. An
applicant for membership had to make an affidavit in which he agreed
that he would not be a member, stockholder, or officer of, or be in
any way directly or indirectly interested in any similar organization
located within one hundred miles of the city of Duluth, for dealing
in any commodity dealt hi by the members or quoted upon the
board of this association. The affidavit then goes on:

"Or be a partner in any firm or stockholder in any corporation so
dealing, having any office or place of business or transacting such
business upon the Duluth Board of Trade.

"Or shall directly or indirectly aid or assist in the building up of
any similar organization to this association within one hundred miles
of the city of Duluth;

"Or shall directly or indirectly do any such act or use any influence
which shall tend to injure or destroy the business of this association,
or of its meml)ers as a body, or shall refuse to act or use your in-
fluence toward the protection and upbuilding of the business of this
association and of its members as a body hi every way in your power
to the best of your ability. . . .

"Then upon the happening of any such event or contingency you
will forthwith resign your membership in the Duluth Board of
Trade," and failing to resign within five days of the happening of
any such event or contingency [meaning the violation of the rules
about competitive organizations] the member is to be expelled.

THE STORY OF THE NONPARTISAN LEAGUE

was done to compel all grain men doing business at
the head of the Lakes to confine their business to
Duluth. Then all terminal elevators located in Supe-
rior suddenly were closed as public elevators and be-
came private elevators operated by individuals holding
leases. As private elevators they were able to dis-
criminate in the business offered them, and this dis-
crimination took the form of refusing to receive any
grain inspected under Wisconsin rules and by "Wis-
consin inspectors. It does not require anything further
to show you how Wisconsin inspection was put "down
and out" and why all of our grain must now be graded,
inspected, and weighed under Minnesota inspection
rules.

The committee relates that it attempted
to have a hearing with the Duluth Board of
Trade, and met with some of the officers and
members for that purpose. Before the session
opened members of the Duluth Board took
exception to the fact that State Senator Hud-
nail of Superior, Wisconsin, had been invited
by the committee to be present. At the last
convention of the Bankers' Association, Sen-
ator Hudnall had spoken about the system
of grain-grading in use in Minnesota, and had
made statements to which members of the
Duluth Board vehemently objected. The
committee had now taken him along to de-
termine whether these statements were true
or false. The committee's report says:

Memlxrs of the Board of Trade absolutely refused
to proceed with the conference while Senator Hudnall

144

UNEQUAL FIGHTS

was present, notwithstanding the fact that your com-
mittee stated that if the conference could not proceed
while he was present, his statements would have to be
accepted as facts by the committee.

Objections were also made by members of the Board
of Trade to the stenographer who was present at the
request of your committee.

Your committee withdrew from the conference for
the purpose of considering the objections raised by
the members of the Board of Trade. Being present
at the invitation of the board, and feeling that our
request to have Senator Hudnall present long enough
to go over the statements made by him at our conven-
tion, to which exceptions had been taken by the board,
was not unreasonable, and also feeling that an effort
was being made to throw such restrictions around the
conference as would make it of no value whatever to
the committee, it was finally decided that we would
withdraw and not attempt to proceed farther with the
conference at that time. The committee thereupon re-
tired from the conference.

Farther on the report has this highly sig-
nificant passage:

Following this attempt at a conference with the
Duluth Board of Trade, your committee entered into
correspondence with a large number of Eastern millers.
This correspondence was of considerable interest, and
disclosed the fact that the Eastern millers cannot ob-
tain grain at Duluth except in the condition in which
it is offered to them as to mixing. They wiuit a cer-
tain proportion of the grain of good grades just as it
comes from the shippers, but can obtain it only after
it has been mixed and the higher grades reduced in

quality.

145

THE STORY OF THE XOXPARTISAN LEAGUE

It appeared certain, therefore, that, as I
have before indicated, the consuming pub-
lic had to bear a part of the cost of these
operations.

The power of the Duluth Board of Trade
to punish and disable any person that incurred
its ill will might well cause just men to pause
and ponder. H. T. Fowler, of Superior, tes-
tified that he had been put out of the grain
business by the secret influence of the board.
He was a shipper of grain by Lake boat and
soon after the board had undertaken to sup-
press Superior he had a large vessel in port
that he was loading. When the load was less
than half completed the man of whom he
was getting the grain called him on the tele-
phone and said:

;'The stuff is off. I can't buy any more
for you."

"I asked him what was the matter," Mr.
Fowler testified, "and he said they simply
would not let him buy. Then I sold him the
balance of it [the load]. Since that time I
have not attempted to ship a boat-load of
grain."1

It appeared further that the railroads as-
sisted the Board of Trade in its campaign by
obstructing the Wisconsin inspection on cars
of grain passing through Wisconsin to Duluth.

' Before the Interstate Commerce Commission. In re Relation
of Curriers to the Grain Trade, p. 100(j.

HG

UNEQUAL FIGHTS

From this combination of powers there seemed
to be no escape.

I should not close this instructive chapter
of history without telling the rest of the story
of the North Dakota Bankers' Committee.
When it had laid bare the secret springs of
the grain monopoly at the head of the Lakes
that was levying so crushing a toll upon the
Northwestern farmer, the committee sought
an interview with the controlling officers of
the Great Northern Railroad. It will be re-
membered that the railroads centering at
Superior had played the monopoly game by
obligingly closing their elevators as public and
maintaining them as private warehouses,
thereby taking them out of the state inspec-
tion or control. The committee wanted the
Great Northern to reopen its Superior eleva-
tors as public institutions, and to cease to
oppose (and hamstring) the Wisconsin in-
spection law. Mr. Louis W. Hill, son of
James J. Hill, and vice-president of the rail-
road, met the committee with affable cour-
tesy. Then, supported by other officers of
his organization, he politely vetoed the com-
mittee's request. But he offered a proposal
on his side. The railroad company would
lease any or all of its elevators at Superior
on a basis of four per cent, on the investment.
Why not get up an organization of indepen-
dent shippers in North Dakota, or, say, in-

11 147

THE STORY OF THE NONPARTISAN LEAGUE

elude also South Dakota and Minnesota, lease
these Great Northern elevators, and operate
them as might be desired? On this the com-
mittee made in its report the following sig-
nificant and prophetic comment:

This proposition to your committee seems to be the
solution of many of the problems of correcting the evils
and injustices now in existence in the handling of grain
at the head of the Lakes, and your committee will now
take up the matter of perfecting an organization to
take over one or more of the Great Northern terminal
elevators among the independent shipi>ers of the state.
By an organization of this kind the shipper can retain
complete control of his grain. He can obtain the
value of all screenings taken from his grain. The
Eastern miller can obtain grain in just the condition
he wants it, and a competitive market at the head of
the Lakes can be re-established.

Your committee is of the opinion that the reforms
outlined will be of material benefit to the grain-growers
of the state and will be a stepping-stone to a better
system of inspection, viz., federal inspection, which
would do away entirely with the many conflicting in-
spections established in the different states.

So the committee, full of hope and optimism,
went to work to organize the combination of
independent shippers that was to take over
these elevators, while many trusting persons
seem to have stood by awaiting tbe descent
of reform as if let down from the skies. It
did not descend. The combination of inde-
pendent shippers was not organized. Gen-
tlemen that looked into the project saw that

UNEQUAL FIGHTS

with the governments of North Dakota and
Minnesota in the hands of the railroads, and
the railroads operating in closest conjunction
with the Chamber of Commerce, the chances
at that time, anyway, were too hazardous.1
The railroads would thus have a garrote
around the neck of any such enterprise, and,
judging by all their past history, would not
hesitate to apply it instantly at the word of
the grain combination. There was but one
power able to deal with such a situation, and
that was the power of the state administered
in the interests of the public; and there was
but one effective way for that power to be
exercised and that was through the creating
of terminal elevators owned and operated in
the public behoof. The mere fact (shown be-
fore the Interstate Commerce Commission)
that the railroads could, if they wished, haul
their cars straight through Superior without
allowing any inspection they did not care to
allow, and the other fact that the Duluth
Board of Trade could practically put out of
business any dealer or handler or combina-
tion of dealers and handlers that incurred its
ill will, made cautious men too wary of such
a project, and the generous hopes of the com-
mittee soon proved to be but rosy dreams.

1 Years later the Equity Society, becoming strong in Wisconsin,
erected a market of its own in Superior, and has made of it a success-
ful venture.

1-i'J

THE STORY OF THE NONPARTISAN LEAGUE

It was when this became apparent, and all
observing men saw there was no possible
relief except through state action, that the
idea of terminal elevators owned by the state
began to appeal strongly to the people at
large as the only way out of the morass.

CHAPTER IX

THE SPINNING OF THE WHEEL OF FORTUNE

MOREOVER, the farmer knew well enough,
as we found in the sour story of the Clay
County revolt, that he suffered by reason of
the vast gambling operations in the markets
at Minneapolis and Duluth. He knew that
the greater part of the telegraphed market
quotations from Chicago was merely the
records of bets, and yet these bets profoundly
influenced the income he wrested from his
land.

There was no good reason why the bets
of two gamblers in Chicago should cause him
to lose two hundred dollars on his harvest
in North Dakota, yet they had this effect,
nevertheless. He knew, too, that very often
the betting was not honest betting, but a show
of betting on a prearranged scheme to reap
illegitimate profits from the unwary lured into
a controlled market, and that in the end his
toil and care must be taxed for the making of
these profits. He knew, when the market at

151

THE STORY OF THE NOXPARTISAN LEAGUE

Chicago was affected by cabled despatches
received from Argentina or India, that often
these despatches were spurious or sent by
accomplices of the gamblers in Chicago. Yet
he knew that when such false intelligence had
put down by five cents what was called the
price of December wheat in Chicago, the next
J.ay the price of wheat would fall at least five
cents at his local elevator in North Dakota.
Even if the month were September this fall
in the December quotation in Chicago would
have this effect in North Dakota. And he
knew all the time that the so-called December
price meant merely that one gambler had bet
the price of wheat would be five cents less in
December, and another gambler had bet that
it would not, and the farmer stood to lose
five cents on each bushel merely because of
this bet.

lie kne\vr also that at no time could there
be any assurance of reality in the so-called
market quotations, since at any time there
might be progressing a gigantic deal in which
all the reported values would be fictitious.
lie knew that as a general rule the price of
grain was made low when the fanners had
grain to sell and high when they had sold out,
and he knew that this was merely another
evidence of manipulation. For instance, here
is a table that shows how the price of corn
was manipulated in the year 1911:

"

THE WHEEL OF FORTUNE

Average Price Stock of Corn in

Month of Corn Farmers' Hands

January 48 . 2 Heavy

February 49 Heavy

March 48 Declining

April 49 Declining

May 52 Small

June 55 Much smaller

July 60 Still less

August 65 Little or none

September 65 Little or none

October 65 Little or none

November 64 New crop

December 61 New crop

His daily experiences showed to the farmer
that the laws of supply and demand about
which schools and theorists have much to say
had become myths. Plainly it was not the
extent of the supply that determined the price
levels, but something else; and it was not by
chance that the low levels prevailed when the
farmer had corn to sell, and the high prices
wrhen, the corn having passed from the farm-
er's hands, the selling was to be done by
somebody else.

In 1909 this country produced a larger
grain crop than in any previous year in its
history. Two years later there was a small
yield of wheat both here and abroad. Yet
the price of wheat in 1911, the year of small
yield, was about twelve cents a bushel less
than the price in 1909, the year of prodigious
yield.

153

THE STORY OF THE NONPARTISAN LEAGUE

In March, 1014, there was less corn by three
hundred million bushels in the United States
than the country produced in 1912, and still
the price in 1914 was lower, when by all the
laws of supply and demand it should have
been higher.

In 1898 Joseph Leiter of Chicago entered
upon a campaign to put up the price of wheat
by purchasing great quantities and holding it
until the price should reach a certain figure.
The wheat was bought and held, and the price
soared daily because of the manipulation.
Charles A. Pillsbury and Frank II. Peavey
of Minneapolis and Duluth, who were co-
operating with Leiter in the market, being
unable to get further margins from him, sold
their wheat. The market collapsed, leaving
Leiter with a loss of $8,000,000.

In the midst of this transaction it became
necessary to turn in a certain storage of wheat
that had been graded as Xo. 2. So long as
it had that grade it was useless to the manipu-
lators, who could use only No. 1. A demand
was made that the grade on this wheat should
be raised. Accordingly, it was reinspected,
with the result that the original grading re-
mained. A second reinspection had the same
result. Then came a peremptory order from
the State Inspection Department to make that
grade Xo. 1 , and as Xo. 1 it went out to help
one end of the great deal.

1,3 i

THE WHEEL OF FORTUNE

It is a fair question what confidence could
any farmer have in any market when he knew
that it was subject to such control and
manipulation.

The Minneapolis Chamber of Commerce has
a rule that forbids any member to buy grain
in carload lots at country points for more
than the city price of that day, less the freight
to Minneapolis. And the city price is based
primarily upon the recorded bets on what
the price will be months hence in a market
thus controlled and manipulated. I earnestly
desire not to be unjust or to give any coun-
tenance to the personal attacks that have
been a regrettable feature of this conflict,
knowing well enough that all these conditions
are the result of a system, and nobody's fault.
But it does seem to me that gambling on
the faro layout, as administered by Michael
McDonald, in Chicago, or Patrick Sheedy,
at Long Branch, was infinitely fairer. There
the cards were not stacked nor marked; if you
lost it was the turn of luck or fate and not
any trick imposed upon your innocence that
lightened your pocketbook.

Can we say the same of the gambling by
the great wheel of fortune on the Chicago
Board of Trade and Minneapolis Chamber of
Commerce?

For instance, in the summer of 1915, Xo. 1
Northern wheat was selling at Minneapolis for

THE STORY OF THE NONPABTISAN LEAGUE

about 98 cents. A wholly fictitious story was
prepared and printed concerning the forcing
of the Dardanelles, which was said to be im-
minent, and about the quantities of Russian
wheat that would thereupon be released.
This drove down the price of what is called
the December option, the technical term for
the bet on what wheat will be worth in
December, to 80, and finally to close upon
70 cents. The price of cash wheat at the
country elevators followed this decline, and
the farmers lost, in consequence, a huge sum,
estimated in some quarters at $50,000,000.
This is by no means impossible. The decline
in the market brought about through this false
story averaged 16 cents. The total wheat
crop that year was 1,025,801,000 bushels. If
the whole crop had been marketed at the
artificially reduced price the loss would have
been $100,000,000, and the chief question is
how much the farmers had parted with when
the decline was effected.

The total losses of that year caused to the
wheat-growers by manipulation alone have
been estimated between $180,000,000 and
$300,000,000.

It was the year of the sensational Armour
bear raid, the toll of which from the farmers
was enormous. This began on May 1st,
when the price of Xo. 2 Red wheat 1 on the

1 Tliis is an ol<l Chicago grade.

1.5G

THE WHEEL OF FORTUNE

Chicago market was $1.64 a bushel. Armour
and his associates on the Chicago Board, hav-
ing sold out their wheat to the Allies and made
$8,000,000 by the operation, began to engineer
the decline. They gave orders to sell July
wheat at the market in unlimited quantities.
By July 1st they had driven the price down
to $1.243^. They then delivered 20,000,000
bushels and the price went up to $1.32. Then
they began to sell September wheat, until by
September 1st they had driven the price down
to 98 cents.

The farmers were then marketing their
wheat, and it was against a price level thus
brought about that they must sell.

American agriculture had in the great oats
deal of 1906 another historic lesson in the
true meaning of the speculative control of its
markets.

New oats always command a lower price
than oats of the previous year's crop. Up to
July 20, 1906, only 41 cars of new oats had
been received at Chicago. On that day the
market was suddenly flooded with new oats.
In the morning hours on the Board of Trade
115 cars were offered for sale, and the mar-
ket under the pressure broke 4 to 5 cents.
Since only 41 cars of new oats had reached
Chicago, the mystery was where these offer-
ings came from. Anxious inquirers finally
learned that the flood had been released by

157

THE STORY OF THE NONPARTISAN LEAGUE

the Peavey Grain Company and the Armour
Grain Company, each operating grain-mixing
houses. The Peavey Company had released
80 cars in the name of the Armour Company,
and the Armour Company had released 35
cars in the name of the Peavey Company.
These cars, on examination, were found to
contain only a few kernels of new oats, all the
rest being old. The profits were goodly to
the operators, but the loss to the farmers was
irreparable.1

The amount of gambling in grain in this
country is enormous and unsuspected by the
moralists, who are generally shocked at a faro
layout and indifferent to this immeasurably
greater evil. It was estimated in 191G that
the total of trading in futures on the Minne-
apolis Chamber of Commerce was 10,000,000,-
000 bushels a year, though the total receipts
of actual wheat were only 300,000,000 bushels.
In 1915 Samuel Hallett Greely, for a quarter
of a century a trader on the Chicago Board of
Trade, sold his membership that he might
testify freely, and appeared before a committee
of the national House of Representatives then
investigating grain exchanges. He said that
in his judgment, at the lowest estimate the
trading in futures on the Chicago Board

1 Before the Interstate Commerce Commission. In rr Relations of
Common Carriers to the Grain Trade; testimony of II. D. Wetmore,
member of the Chicago Board of Trade, November, 1900. See
Senate Document 278 of Uiat year.

158

THE WHEEL OF FORTUNE

("phantom grain," he called it) was three
hundred times the dealings in actual grain,
and this estimate was presently seen to he
most conservative. He said he had seen in
a single day twenty-five firms buy and sell
5,000,000 bushels each for future delivery.
He described himself as only "an insignificant
trader," but on many a day he had bought or
sold 1,000,000 bushels and thought nothing
of it. But from other sources it appeared
that the total annual receipts of real wheat
at Chicago were about 25,000,000 bushels,
whereas a fair estimate from the day's trading
showed annual dealings in about 17,000,000,-
000 bushels of "phantom wheat." The bulk
and the profits of the business in "phantom"
might be gaged from the fact that Chicago
brokerage firms leased private wires to the
Pacific coast at an annual rental of $100,000
each to carry their operations, and sometimes
worked large forces of clerks and bookkeepers
day and night to enter the bets they were
making.

Willett M. Hayes, formerly Assistant Sec-
retary of Agriculture, went far beyond Mr.
Greely's figures. In an article in the Jour-
nal of the American Academy of Political and
Social Science, entitled "Functions and Needs
of Our Great Markets," he says: l '"There is
evidence that the really large speculative deal-
1 P. 253.

159

THE STORY OF THE XONPARTISAX LEAGUE

ing is in wheat on the Chicago market. Esti-
mates made some years ago indicate that 90,-
000,000,000 bushels of grain sales were made
annually in Chicago," and in another place
he says: "A very rough estimate places
the money received from the people by ex-
changes (grain) and bucket-shop appendages in
America alone at upward of $200,000,000
annually." *

It is apparent, therefore, at a glance that
the speculative interest in the grain market
incalculably outweighs the interest in the
actual marketing of actual grain. If the
business and function of the Minneapolis
Chamber of Commerce were to provide a
means whereby the buyers and sellers of
grain might come together, we should see a
totally different condition. The pretense of
the Chamber is that it exists for this pur-
pose, but it is a pretense that will bear no
examination. Three hundred million bushels
of wheat are received at Minneapolis an-
nually. The commission for handling this is
one cent a bushel. The total produce of this
divided among the hundreds of firms and in-
dividuals operating on and about the Chamber
would make but poor pickings. From no such
sources could be built the great fortunes and
imposing palaces of the grain kings of the
Northwest. That is obvious; and the philos-

1 P. 250.

100

THE WHEEL OF FORTUNE

opher will not need to be reminded once more
that the greatest and most ruthless of human
of great have always pertained to the chances
passions speculative profits.

Mr. Hayes says: "It is perfectly clear,
however, that in the large the outside specu-
lators and the producers and consumers,
among them, lose money to a class of men
that do not really pretend either to produce,
to transport or to manufacture; and that
they also [producers and consumers] pay the
expenses of running an expensive speculating
machine."

He overlooked the fact that this expensive
speculating machine, as its wheel whirls and
whirls like that at Monte Carlo, may sweep
away from the farmer the fruits of a year of
drudging labor. The plowing, the harrowing,
the seeding, the cultivating, the harvesting,
the threshing, the long journey to market
with the staff of the world's existence, and
all made of no avail because somebody has
manufactured a cable from Buenos Ayres or
a story about good weather in India, that the
speculative machine may spin this way or
that. But the farmer has not overlooked tlit
fact; and nothing could be more preposterou>
than to suppose that, knowing it, he will
always patiently endure it.

The committee of the national House of
Representatives, to which I have several

161

THE STORY OF THE NONPARTISAN LEAGUE

times referred in the course of this narrative,
was left, after its investigations, with no un-
certain impression as to the seriousness of
this evil. It made in its report these preg-
nant findings:

That it is the common practice of these controlling
members [of the grain exchanges] by concerted action
in these three great markets [Chicago, Minneapolis,
and Duluth] offering or withdrawing enormous quan-
tities of wheat at the public warehouses and terminal
elevators and by concerted bidding and betting in the
pit on futures, to depress or raise the price of wheat
to suit the purpose of their gambling operations. . . .

That for each bushel of real wheat actually sold and
handled in each of these terminal markets at least one
hundred bushels are bought and sold in so-called future
trading.

That the multiplied expense of all such future trad-
ing, as well as most of the profits thereof, must come
out of the real wheat actually marketed.

That the only part of the gains of gambling in wheat
not borne by the farmer or the buyer is borne by men
tempted to speculate in the pit.

That the number of embezzlements, bankruptcies,
and wrecks caused by gambling in wheat futures is
appalling.

That the members of the Chicago Board of Trade,
the Minneapolis Chamber of Commerce, and the
Duluth Hoard of Trade, through whom such gambling
operations are made, cover and hide the record of the
losses sustained by speculators and refuse to exhibit
their books to the state officials whose duty it is to
protect the public.

That the Chamber of Commerce of Minneapolis

and the Board of Trade of Chicago, by virtue of a

162

THE WHEEL OF FORTUNE

large membership of wealthy men, closely allied with
banking institutions, transportation companies, and
with certain daily newspapers of their communities,
exercise and control an unwholesome influence in local
government and public opinion.

To this solemn indictment no answer has
ever been made.

The point brought out by the committee
concerning the refusal of these members of
the grain exchanges to produce their books
before competent authorities has had a cor-
roboration from the records that should be
set down here to warn us how strong is the
spirit of arrogance begotten of such great
power and unusual privileges.

In the course of the investigation by the
Minnesota House Committee a point was
reached where the accurate knowledge of
certain transactions became necessary, and
the counsel for the farmers present made
this request:

I think in view of the suggestion made that there is
no necessary expense, middleman's expense, incident
to the handling of grain through the operation and
dealing in futures, under the Chamber of Commerce
rules, practices, and so forth, I am going to ask the
representatives of the Chamber of Commerce and the
dealers to furnish proof by competent evidence of the
total amount of money made by these men as com-
missions. First, commissions handling actual grain;
second, commissions earned by virtue of the execution
of future contracts [making contracts on the future];
12 163

THE STORY OF THE NONPARTISAN LEAGUE

and third, profits made by scalping in grain, and the
total aggregate profits made by middlemen, standing
between the producers and consumers. I am making
this request, putting the burden on the Chamber of
Commerce and the men that are defending the dealing
in futures of showing by original competent testimony
that it is not an unfair or unreasonable trade. I do
not care by what means they show it.

This request was never complied with.

Later the committee, by a vote of its mem-
bers, instructed Mr. Williams, secretary of
the Clearing House Association of the Cham-
ber of Commerce, to prepare a statement
from his records showing the total amount
of future transactions on the floor of the
Chamber.1

This statement was never furnished.

A little later the committee instructed V.
S. Ireys, a pit trader of Minneapolis, to
produce his books and show his transactions
in futures.2

These instructions were never obeyed.

The committee had previously demanded
that E. L. Welch, one of the most prominent
of the Minneapolis grain-dealers, produce his
books for the year 1912 to show the amount
of actual wheat his firm handled and the
amount handled as futures.3

This demand was never complied with.

'Investigation by Minnesota House Committee: testimony, p.
1331. *llnd: testimony, pp. H51-1452.

' Ibid: testimony, p. 883.

THE WHEEL OF FORTUNE

Later, Mr. Welch was instructed to furnish
a statement showing the profits and losses of
outside traders through his firm as contained
in its books.1

This statement was never furnished.

While Mr. Welch was on the stand this
colloquy took place:

Question (by Mr. Teigen, a member of the committee).
— Now is not this little side-show you have in the
smoking-room an absolutely pure, simple gambling
proposition?

MR. MANAHAN (of counsel for the farmers). — I think
I covered that.

MR. TEIGEN. — You never got yes or no on it.

MR. MANAHAN. — You won't, either.

WITNESS. — I answered that it was to a certain
extent.

MR. TEIGEN. — Can't you make a yes or no on that?

No answer.2

When the Interstate Commerce Commis-
sion was investigating one phase of this sub-
ject it had before it Mr. F. R. Durant, de-
scribed as the manager of the Grain Bulletin,
a peculiar publication issued from the Cham-
ber of Commerce and having a close rela-
tionship to the prices the farmers were getting
for their wheat. The Commission was very
curious to see some of Mr. Durant's books
and papers. He never produced them be-
cause he averred that all had been destroyed.

investigation by Minnesota House Committee: testimony, pp.
889-890. 2Ibid: testimony, pp. 904-9UG.

165

THE STORY OF THE NONPARTISAN LEAGUE

Tliis in especial seems a pity, because Mr.
Durant must have been in possession of knowl-
edge that would have cleared up some of the
mystery in which the Minneapolis Chamber
of Commerce operated. lie was not only the
manager of the Grain Bulletin, but of a com-
bination of grain-dealers that seem to have
had a close working arrangement as to the
prices they would pay for grain. Being asked
as to the functions of the Grain Bulletin, he
said it was ''a bureau for the furnishing of
information to grain-dealers at country points
—such information as is necessary to the con-
ducting of their business." There were about
eighteen members of the Chamber of Com-
merce that were in his organization, and these
members and subscribers owned together 1 ,275
elevators through the Northwestern country,
so it will be seen the information they received
might be of great importance to them, and
also to the farmers whose grain was to be
graded and bought by these 1,275 elevators.
Mr. Durant was now questioned more in par-
ticular about these matters.

Quest icm. — What information do you send out?

Answer. — The value of grain at different country
points based on what that grain will sell for in terminal
markets.

Q. — You send the value at the country points?

A. — Yes sir.

Q. — Not in Minneapolis?

A. — No sir.

166

THE WHEEL OF FORTUNE

Q, — The value you send deducts the freight rate
from that point into Minneapolis?

A. — Into Minneapolis as a general proposition.

Q. — Does it deduct the margin of profit?

A. — Yes sir; a maximum margin of profit.

Q. — Who determines that margin of profit?

A. — That maxi num margin was determined when
we first organized to give out this information. It
was, as nearly as I can recollect, the consensus of
opinion of the majority of subscribers.1

The meaning of this seemed sufficiently
clear. It was an arrangement by which the
prices the country elevators were to pay for
wheat were fixed in Minneapolis (on the
general basis of the wheel of fortune) and
the elevators notified. Further questioning
elicited the fact that there were also agree-
ments to divide the grain that came in at
the country stations.

Question. — Since your association was formed, what
is the greatest number of points that have been affected
by these agreements to divide the grain?

Answer. — I do not remember more than 125; per-
haps ISO.2

Nevertheless the nature of some of these
operations seemed to be fairly well indicated
by the following extraordinary document,
which was now put in evidence:

1 Before the Interstate Commerce Commission. In re Relations
of Common Carriers to the Grain Trade; testimony, p. 967.

2 Ibid., p. 9G9.

1G7

THE STORY OF THE NOXPARTISAN LEAGUE

MEMORAXDUM OF AGREEMENT AT WORTHINGTON,
MINNESOTA

Effective August 1, 1900

H. E. Torrence, Swedish Mercantile Co.,

Hubbard £ Palmer, Peavey Elevator Co.,
H. N. Douglas, St. John Bros.

Each to receive one-sixth (1-C) of the entire receipts
of all the grain handled at Worthington.

Prices to be made by H. N. Douglas, but are to be
as nearly as possible on the following basis:

Wheat at 12 cents, and fraction off Minneapolis close.
Oats at 6 cents and fraction off Minneapolis. Flax
at 16 cents off Minneapolis. Corn at 10 cents off
Minneapolis. Timothy seed at 65 cents per cwt. off
Chicago.

Penalties1 to be: Wheat, 2}/2 cents; oats, 1*^> cents;
corn, 2 cents; barley, 3 cents; rye, 4 cents; flax, 4
cents; timothy, 10 cents. Full rates of storage, as
shown on standard storage tickets, to be collected.

Minimum dockage to be one pound a bushel,2 and a
sieve test to be made of all wheat showing over two-pound
dockage. All parties agree not to pay over the list.

Closed houses to get one-half the penalty.

Statements to be rendered each week to II. X.
Douglas, who is to report to F. R. Durant.

The books of any party to this agreement are to be
subject to examination at any time. This agreement
to continue in effect for one year from date. . . .3

That is to say, the grain-buyers of Worth-
ing on had farmed a close corporation to con-

1 For paying any other Ihan these prices for ^rain.

2 Apparently even if the wheat was perfectly clear.

3 Before the Interstate Commerce Commission. In re Relations,
etc.; testimony, p. 907.

108

THE WHEEL OF FORTUNE

trol and divide all the grain that came into
their town and to pay for it the price fixed
by a secret conclave in Minneapolis. And
these prices were the prices made by the
gambling bet on the future or option plus
a margin for profit determined in advance
by the conclave of the Chamber of Com-
merce. Contemplating these astounding rev-
elations, the wonder seems not that farmers
found farming unprofitable, but that any-
body remained on the farms.

The light thus thrown upon the grain busi-
ness as it really was gives to the following
letter a piquant interest:

MONTEVIDEO, MINN.,

October 15, 1906.
NATIONAL MILLING COMPANY,
MINNEAPOLIS, MINN.

GENTLEMEN, — We have your letter of October Hth
and note that you have sent your superintendent of
this line to Clinton to get the grain-buyers to agree
among themselves as to what price to pay for grain.
You certainly have our hearty approval, and I sin-
cerely trust the buyers will be able to hold prices this
year where we may be able to make a little money.

Yours truly,
MONTEVIDEO ROLLER MILL COMPANY.

By II. C. Stebbins, Manager. l

But the real taste of these revelations is to
be had only by comparing them with the

1 Before the Interstate Commerce Commission. In re Relations,
etc.; testimony, p. 96o.

1G9

THE STORY OF THE NONPARTISAN LEAGUE

stories of combinations the farmers tried to
form for their defense, with the story of the
ruined or suppressed farmers' elevators, the
long fight of the Equity, and the tragic story
of the Minnesota Farmers' Exchange. With-
out the least bitterness one may say that
combinations on one side seemed always to
thrive and yield more profits to a business
already fruitful; combinations on the other
side met with uniform disaster at the hands
of a power so great it could disregard law
and defy what had always been regarded as
fundamentals of life in America.

CHAPTER X

SOME ADVENTURES IX PHILANTHROPY

ONE thing that to the farmer's substantial
injuries added an incessant irritant was
not of a nature to appear before investigating
committees, and yet had a definite effect in
bringing about his revolt. I have referred
to it before as it presented itself. It was this
constant easy assumption of politicians and
lawyers of the governing class that he was
only a good-natured rustic clown and could
be hoodwinked indefinitely. I am not deny-
ing that the farmer brought some of this on
his own head by persistently voting for some-
body else at the polls and never voting for
himself; but that did not lessen the sting of
it. The professional candidate was always
coming out of his law office about election-
time to deal in the same time-worn flatteries,
to shake ostentatiously the farmer's knobby
hand, to slap him on the back and inquire
with transparent eagerness about the health
of his grandmother, and to pass from those
employments to the making of laws that

171

THE STORY OF THE NONPARTISAN LEAGUE

would rope him more securely. It was a con-
dition not at all peculiar to North Dakota;
it existed and exists all about the country.
But the Northwestern farmer certainly had
instances of it that seemed to him of a raw
significance, and it is time we related some
of these.

By 1913 the farmers of Minnesota had
become weary of a system by which they
raised wheat for the exclusive profit of other
men, and they made a determined attack
upon the legislature that they had helped to
elect. They remembered, they said, the many
kind words that had been poured into the
porches of their ears by various candidates
while the electoral campaign was on, and they
thought the time was ripe to turn some of
these golden phrases into the merchantable
form of achievement. If the farmer was
really such a fine fellow and so important to
the world, there would be no objection to
passing a few simple and equitable laws to
protect him. So the Minnesota farmers de-
termined to secure from the legislature the
following reforms:

A law to abolish the weighing frauds in the grain
trade and compel the use of honest .scales and honest
weighing methods.

A law to put a stop to trading in grain futures in the
state arid thereby do away with the system by which
the price of grain at the country elevator in Minnesota

17*

ADVENTURES IN PHILANTHROPY

was determined by a bet made in Chicago and recorded
in Minneapolis.

A law to compel the state grain inspection to men-
tion in each inspection certificate what was the weight
by the bushel of the grain inspected, so that the shipper
might have a chance to know the weight assigned at
Minneapolis and compare it with the weight assigned
at the shipping point.

A law to put a stop to what is called "unfair compe-
tition" in grain buying, by which was meant the prac-
tice of the "line" elevators of paying extravagant
prices for grain at points where the farmers had estab-
lished their own elevators.

A law to give the shipper of grain a lien upon the
membership in the Chamber of Commerce of the mem-
ber to whom he had shipped the grain.

A law to tax transactions in grain "futures" if the
law to prohibit this form of gambling could not be
passed.

These were the measures requested by the
farmers of the state of their representatives,
the slappers of backs and liberal givers of
promises when the election campaign was on.
Not one of these measures was passed; not
one saw again the light of day after it had
been referred to a committee. In the dark
recesses of committee-rooms each was quietly
strangled.

At the legislative session of 191.3, however,
the farmers did succeed in securing one meas-
ure, or part of it, but even this they got
because it was disguised to the casual eye.
They had a cumulative grievance against

173

THE STORY OF THE NONPARTISAN LEAGUE

the Chamber of Commerce, the product of
a generation of costly experience. They
wished to have the facts about the Chamber
laid bare. In the House of Representatives,
therefore, they introduced a bill that pro-
vided for a committee of members to inves-
tigate grain exchanges.

It was a time when the Equity co-operative
exchange was under fierce attack by the
Chamber and its allies, and this condition is
held responsible for the passing of legislation
that otherwise would never have gone through,
for there was an impression that the measure
aimed at the Equity. The committee was
duly constituted and went to work. At once
the fact appeared that the farmers had out-
witted their opponents, for they were ready
with a mass of startling testimony and fur-
nished with an array of able counsel, and
day after day they were turning up the his-
tory and operations of the Chamber in a way
most painful to the Interests concerned.
These made haste to slip through the Senate
a bill constituting another committee to in-
vestigate grain exchanges. It was made up
carefully and scrupulously of trustworthy reac-
tionaries, and endeavored to negative, distort,
nullify, or obscure every disclosure made be-
fore the committee of the other house. The
result of all this was that for immediate effect
the one balanced the other, and the farmers

174

ADVENTURES IN PHILANTHROPY

found themselves in the familiar position of
defeat.

What is said here about the composition of
the Senate committee is not to be taken as an
assertion. It is the admission of the chair-
man of the committee. He said that he had
selected the members after consultation with
Mr. McHugh, secretary of the Chamber of
Commerce, and with other gentlemen equally
interested on the Chamber's side. The State
Bar Association, the next year, marked its ap-
parent approval of these things by making the
chief counsel of the Chamber of Commerce
its president and the assistant counsel its vice-
president. Both of these had figured con-
spicuously in the proceedings before the Sen-
ate committee — a fact from which we can
easily surmise where the heart of the associa-
tion found its loyalty to lie.

Close upon the heels of this experience fol-
lowed another that, though seemingly so small
a matter, came to be regarded by the farmers,
because of the manner of it, as an additional
affront. This was an organized propaganda
called "The Better Farming Movement."
The farmers after a time charged that its
sole origin was the fact that they were dis-
contented and always becoming more dis-
contented, and that Organized Great Business
profitably interested in the existing order be-
lieved something should be done to distract

175

THE STORY OF THE NONPABTISAN LEAGUE

their attention and make them keep still.
The fundamental idea of this movement was
that the farmers themselves were at fault if
their business was unprofitable, because they
did not follow the best methods in their farm-
ing. Therefore the movement kindly set
out to teach them these best methods. If
only right methods could be introduced, all
would be well in the Northwest. The funds
for this grand work of education were
raised originally by subscription from banks,
great lumber firms, grain-houses, railroad
companies, agricultural - implement makers,
and mail-order concerns, but later the legis-
latures were induced to approve of the proj-
ect and to indorse an arrangement by which
one-third of the expense was to be borne by
the state, one-third by subscriptions among
the farmers, and one-third by the business
enterprises I have referred to.

Under this arrangement instruction in farm-
ing was to be provided at gatherings and as-
semblies through the country. The Depart-
ment of Agriculture of the United States gave
to the benevolence at least a tacit indorse-
ment by allowing ''Better Farming" circulars
to be sent through the mails under the de-
partment's frank. After a time the farmers
complained that the meetings to which they
went with open mouths and thirsting souls,
eager for instruction, were used to advise

17G

ADVENTURES IN PHILANTHROPY

them to ship their grain to the Chamber of
Commerce and for little else, except as a
good, reliable advertising medium for the
Chicago mail-order house most interested in
this form of education. The revelation that
this house had sent fourteen carloads of its
catalogues to Fargo to be distributed by the
agents of agricultural elevation caused a chill
to go over the movement so far as the farmers
were concerned. Also, the discovery that one
of the milling firms equally inspired to the
uplift was using the frank of the Department
of Agriculture to distribute glowing circulars
concerning the superior qualities of its flour
served to complete the measure of disgust,
and when the movement became involved in
a scandal in the North Dakota State Agri-
cultural College, a scandal involving distress-
ing charges of graft and manipulation, "Better
Farming" as a cult died away and the farmer
was left to follow his own devices unenlight-
ened by the kindly cheer of the Lumber or
any other Trust.

But the fact had been noted, and long re-
mained in the minds of many farmers as sin-
ister, that local banks had been fervid sup-
porters of the scheme. Taking their grain
to market and calling upon the town bank to
cash their elevator orders, they had generally
been introduced there to "Better Farming."
It was plain that this had been done by in-

177

THE STORY OF THE NONPARTISAN LEAGUE

struction from a common source, and the
nature of that source could easily be guessed
by any farmer that would glance at the In-
terests that were supporting the movement.
Clearly enough, then, some banks were nerve
centers of influence controlled by a gigantic
and secret power concerned in maintaining
the existing system intact; maintaining all of
it, no matter how dishonest and vicious, the
false grading of grain, the defective scales, the
various pickers and stealers ranged in a long
line between the producer and the consumer,
all were supported by the average country
bank acting on instructions from bigger banks
that in turn were instructed by some con-
centrated authority representing an appalling
power of heaped-up wealth. They recalled
how often the same institutions had used the
like influence to encourage the sending of
grain to Chamber of Commerce firms, how it
had discouraged co-operative and farmer
movements, how it had often exerted a quiet
but sure influence in politics. They reflected
also that over the average fanner the average
country bank held the pistol because it could
at any time for any reason or no reason refuse
to make to him the money advances by which
he was able to carry on his business, and be-
cause behind all this still was the shadow of
the mortgage, which the bank controlled.
These lessons went home, and it may be well

178

ADVENTURES IN PHILANTHROPY

concluded that "Better Farming" did not
teach much agriculture to the farmer of the
Northwest, but it taught him other things
not less valuable.

The last attempt of this kind to divert his
mind from his complaints came in the fall of
1915, when the governor of North Dakota
set apart one week to be known as "Appre-
ciation Week," the time to be utilized in
spreading the glad tidings of the many ad-
vantages, great happiness, and abounding
resources of the state. The newspapers, prac-
tically all of which warmly applauded this
idea, explained that unprincipled persons had
been retailing slanders about North Dakota.
These libelers had said that it was a state
ridden by corporations and controlled by the
railroads, that the farmer there was syste-
matically plundered, that abnormal conditions
forced upon him by these influences had made
farming an unprofitable business. The state
was suffering injury by these loathsome false-
hoods. Many persons that might otherwise
come there to buy farms and town lots were
being kept away by such reports, and conse-
quently the farmers were enduring heavy
losses in the value of their farms. \Vhat was
needed was plenty of boosting for North
Dakota, the grandest state in the Union.
"Boost, don't knock," was the favorite if
slangy motto of these publications through-

13 ' 179

THE STORY OF THE NONPARTISAN LEAGUE

out that week, and it can be guessed whether
the real-estate agents and dealers in farming
property regarded the movement with enthu-
siasm. The understanding through the state
was that the fervor to be aroused by such a
dedication would be an efficient check to the
growth of the Xonpartisan League, which
had but lately been revealed to the machine
politicians as a menace to their way of life.
If this was so the hope failed. Instead of
joining in a movement that might be thought
to appeal so strongly to their sentiments, the
farmers generally denounced it as a trick and
went steadfastly on to perfect and extend their
militant organizations, offensive and defensive.
They would not budge for force or cajolery,
and it is self-evident that only men sure of
their cause and committed to it on a reasoned
conviction will stand fast in that manner.

There was another portent that a wise
politician could hardly have failed to notice.
Many farmers made "Appreciation Week"
an occasion to call attention to the awkward
facts about the terminal elevator. Some of
them said that the real slanderers of the state
were the influences that had nullified the
popular vote on this subject, and as it was
plainly these same influences that now were
calling for a chorus of joy, farmers had better
use the week in extra work to redeem North
Dakota from this evil sway.

ISO

ADVENTURES IN PHILANTHROPY

Not long after they had a sharp reminder
that these influences were still unregenerate,
had lost no power and learned no restraint in
its use. I have often mentioned the valuable
scientific research work done at the North
Dakota Agricultural College. In a conflict so
fierce over vital issues like these, the work of
the college could not possibly escape attack.
It was accused of partisanship, although it
had never done anything worse than to ana-
lyze bread and wheat and declare results.
The president of the college was Dr. John
H. Worst. Addressing a meeting of farmers
about this time, he used these words:

The remedy is in your own hands. If the laws do
not suit; if the Constitution stands in the way; if pub-
lic officials are not sympathetic; commanding 80 per
cent, of the voting strength of the state as they do,
farmers need not be told where the remedy lies.

When farmers hint at organizing for the purpose of
managing their own business, or even choosing from
their own ranks Congressmen, governors, and legisla-
tors somewhat in proportion to their voting strength
and vested interests, it comes with poor grace for
certain other interests and professions to criticize, since
they themselves have efficiently monopolized the offices
in county, state, and nation for lo! these many years.

Mr. Farmer, if you ever hope to enjoy justice in
selling or buying, it will come mainly through your
own co-operative efforts. As long as you depend upon
the pretended friends of the farmers for emancipation
from speculative intrigue, the bit will remain in your

mouth.

181

THE STORY OF THE NONPARTISAN LEAGUE

Farmers often take for their profits what a manipu-
lated or speculative market offers, without any regard
for the law of supply and demand. For as long as the
captains of industry have the power to fix their own
compensation for services rendered, they will be gen-
erous to themselves and appropriate for their own use
a part of the farmers' share.

President Yoakum of the Frisco railroad system
asserts that the consumers pay $13,000,000,000 for
what the producers receive $6,000,000,000. In other
words, it costs $7,000,000,000 to distribute $6,000,-
000,000 worth of farm products. We know who re-
ceives the $6,000,000,000, but who gets the larger sum,
the $7,000,000,000?

It would be folly to expect the origiaators of the
present system voluntarily to improve it. If improve-
ment is made it must come through the efforts of the
producers themselves, moved by the same selfish im-
pulse for profit-making that originated the present
system.

To make progress farmers must stick together. The
general belief prevails that farmers will not stick to-
gether. Farmers themselves have come to believe this
fallacy. This is not at all surprising, since this doctrine
has been most vigorously promulgated by those inter-
ests, political and otherwise, which are best served by
cultivating individualistic instead of co-operative effort
among farmers. Farmers, therefore, must organize.

The college was under the control of the
state administration, which was the prod-
uct and exponent of the old political condi-
tions in North Dakota, had zealously sup-
ported "Better Farming" and proclaimed
"Appreciation Week." It is hard to see
what there was in these remarks that was im-

182

ADVENTURES IN PHILANTHROPY

proper or blameworthy, but for making them
Doctor Worst was removed from his place
at the head of the college. There is no doubt
that this act of apparently wanton arrogance,
coming on the heels of the call to universal
"Appreciation," deepened the farmers' re-
sentment and gave to them an object-lesson
they did not fail to understand. The power
of the state, seized long ago by the Interests,
went even to the length of gagging or punish-
ing any person that objected to it.

CHAPTER XI

WHAT CAME OF ONE FARMER'S RUIN

I HAVE set down in the foregoing pages
some citations from the records of a con-
dition strange in any republic, and most
strange in ours. Doubtless every reader that
honors me with his attention will see that I
have given only a few of the possible illus-
trations. The material at hand extends
into hundreds of volumes in courts, legisla-
tive bodies, and the document-rooms of Con-
gress, where it may easily be pursued farther
by the curious. But what is set forth here is
enough to show why in one of the most fertile
regions of the world, with every advantage of
accessibility and great markets, farming was
an unprofitable calling.

So little does one part of the continent
know of another and, even when neighbors,
so little do men of one vocation know about
men of another, that outside of farming itself
everybody believes to the contrary about it.
Especially since the beginning of the war the
joy of the agriculturist has been supposed to

181

HOW ONE FARMER WAS RUINED

be full, or he must be an insatiable cormorant.
Very few of the persons that cling to this
belief would be willing to undertake the farm-
er's career for themselves, and probably not
one would care to sustain life on the average
farmer's margin, but this never discourages
the genial faith in abounding rural prosperity.
But all the time the truth remained, and
everybody that cared enough for it might
easily so find it, that the farmer alone, of all
classes in the community, must sell always
in a wholesale and buy always in a retail
market, and therefore, when the retail market
was unreasonably raised, as from 1914 to 1919,
he necessarily must suffer most. But this
was only the beginning of the Northwestern
farmer's evil lot. It must be apparent from
what has gone before that this farmer must
sell his product to a great and wonderful or-
ganization designed to make his selling price
low and equipped with almost unlimited power
to that end; and he must buy whatever lie
bought from great and wonderful organiza-
tions designed to make his buying price high
and equipped with almost unlimited power
to that end. A farmer confronted with these
vast forces was in a state so utterly impotent
that he seemed like a figure of fun. A straw
in a cyclone, a cockle-shell in a tidal wave, a
leaf tossed over Niagara would have as much
chance. The crude illustration that was so

185

THE STORY OF THE NONPARTISAN LEAGUE

often used in the Northwest was apt enough,
after all; he was like a man roped and thrown
while a procession of armed men picked his
pockets and took his watch.

These oppressions contradicted all the tra-
ditions and impulses of the race. In spite of
occasional symptoms to the contrary7, Ameri-
cans are, of all peoples on earth, the most
jealous of their liberties. You cannot have
generation after generation imbibing in child-
hood the stories of the American Revolution
and revering above all others the men that
rose against the suggestion of tyranny with-
out having in the end a people that will look
upon all kinds of tyranny with the same hos-
tility. I have heard speaker after speaker in
farmers' meetings in the Northwest liken their
cause to that of the American Revolutionists
and make out a reasonable case for the argu-
ment; and I have observed that nothing else
they said aroused so much enthusiasm. Show-
ings of the losses in dollars and cents that the
fanners suffered because of the existing sys-
tems seemed, by comparison, to mean little,
and it was safest of all to predict a revolt in
the light of that singular fact. Something
more was stirred in men than the property
sense; they had gathered a fixed idea that the
forces controlling their affairs were funda-
mentally unrighteous and un-American, and
when that point has been reached anywhere

180

HOW ONE FARMER WAS RUINED

in this country there was never but one
result.

Therefore, any person that knew the Ameri-
can psychology would say at once that there
would be farmers' organization after farmers'
organization until one should arise powerful
enough to cope with these conditions; and
any person that knew the history of reform
would say as surely that when the revolt came
it would be declared to be conducted by bad
men.

For that is the inevitable rule of life. Good
men, or those deemed good in the litera-
ture of their day, never revolt at anything.
Without exception, every social or political
reform has been effected by men whose
motives and acts were fiercely assailed in
their own generation and lauded by all man-
kind in the generations thereafter. No man
ever attacked a vested wrong and escaped
picturing in his own time as a depraved and
dangerous person. Sometimes such men have
lived to see their innovations embodied in the
practices of civilization, and sometimes they
have died on dung-hills, but sooner or later
the triumph of their ideas has usually come
about.

John Wilkes was pilloried to all England
as a monster of wickedness, but every reform
he advocated was adopted within a hundred
years of his death. William Lloyd Garrison

187

THE STORY OF THE NONPABTISAN LEAGUE

was dragged through the streets of Boston
with a rope around his neck, but hardly an-
other name in American history is more re-
spected to-day. As late as 1861 Wendell
Phillips had to be protected by armed volun-
teers across Boston Common because of a
speech he had made in Tremont Temple in
favor of human liberty; there is now a great
monument to him on the ground he trod that
day. If Washington had failed he would
have been in history worse than Jack Cade,
for all the English descriptions of him in his
own time represented him to be a howling
demagogue, abounding in wickedness and in-
famy. Giordano Bruno was burned before
an applauding mob, and organized society in
his day believed itself well rid of a pest; but
one of the most beautiful monuments in Rome
marks the spot where he died.

It is so about great things and little. When
Samuel Plimsoll was toiling for the safety of
sailors other men thought first that he was
crazy, then that he was a nuisance, then that
he was a demagogue and a dangerous person,
full of devilish plots against the maritime sys-
tem that had made England great. When
Samuels tested the British intolerance against
the Jews, prominent journals denounced him
and people spat upon him as he passed. They
honor his memory now. The name of Thomas
Jefferson was covered with abuse because he

188

HOW ONE FARMER WAS RUINED

led a revolt against the settled institutions
of his day; monstrous stories of immorality
were invented against him; some of them
stuck for years after his death and long pre-
vented the just recognition of his services.
Charles Simmer underwent the same fate;
there has been even within a year a recru-
descence of the lies that clouded his fame. The
Populists were hooted and jeered from one
end of the country to the other; most of
them lived to see most of their doctrines
adopted by the great political parties. In
England the Chartists were hunted down and
imprisoned; almost the whole Chartist pro-
gram has since been made into English law.

In whatsoever manner or in whatsoever
form of organization the Northwestern farmers
might have revolted, so soon as their revolting
movement attained to proportions that threat-
ened intrenched Privilege, it would have been
assailed on moral grounds. Men in great
numbers that freely admitted the basic justice
of the farmers' cause wTould have vehemently
decried the tactics that the farmers pursued.
Whatever these might be, they should have
been something else. Exactly as men say they
are in favor of the right of workers to organize,
but are opposed to the unions, so in regard to
the farmers similar minds would say they knew
the farmers had been badly treated, but this
was not the way to redress their wrongs. If

189

THE STORY OF THE NONPARTISAN LEAGUE

the farmer had confined his efforts to the eco-
nomic field, he would have been told to go into
politics. If he had tried to win free by po-
litical action, he would have been instructed
to use only his economic power.

The philosophical expect these things al-
ways and are not much swayed by them.
What is said of men that seek reform is not
of much importance. The reform is the only
thing that endures or is vital. No achieve-
ment of the human mind is easier than to
impugn motives, and actions the most un-
selfish are the actions most readily misrepre-
sented. Nothing counts in the long run but
results. Troops of angels do not now come
down from heaven to set men's grievances
right; human injustice is fought by human
means. I have spent much time in the North-
west studying the troubles of the farmer there,
and it always seemed to me that the attacks
on the men that were trying to bring about
better things were of the truly traditional
type — the assailants were merely repeating
familiar history, and no one need take over-
seriously what they said.

The organization whose rise I am now to
relate has been savagely attacked; I shall not
try to avoid or conceal that fact. Very likely
because of these attacks it is now discredited
more or less in the minds of those that read
about it. I am not to appear in any way as

130

HOW ONE FARMER WAS RUINED

its defender or apologist, because that is not
my business. It has effected the greatest
revolution ever known in American farming;
it has within certain territory abolished or
greatly lessened the evils I have been describ-
ing, and that seems to be enough to make it
worth writing about. And the more so be-
cause the farmer's troubles — although we sel-
dom suspect it — come home every day in the
expense accounts of every one of us, no matter
how far we may be from a farm.

This, then, is the story:

Beach is a town in western North Dakota
where land used to be cheap and settlers few.
In 1913 a young man with a great idea came
to Beach and took up some of this cheap land.
He had been studying soils, climates, and con-
ditions, and it seemed to him that for that
part of North Dakota flax was a better crop
than wheat. Also, he had been studying the
markets, and he had convincing figures to
show that at the existing prices the growing
of flax must be profitable.

He took prairie land, hundreds of acres of
it, and started to break up the tough virgin
sod. Prairie-breaking is about the hardest
of all hard work known to human endeavor.
This young man brought his brother with him,
and the two were so confident about flax at
the market prices that they did not hesitate
to go heavily into debt for the farm machinery

191

THE STORY OF THE NONPARTISAN LEAGUE

and other equipment they wanted. They
bought tractors and gang-plows and seeders;
they hired men and ordered supplies, and, in
the expressive Northwestern phrase, they tore
into the stubble.

No men ever toiled harder. The tractor
and the gang-plow worked incessantly. One
of the brothers operated these machines all
day and the other all night. With a great
search-light mounted on the front of the
tractor, night was as good as day for their
purposes.

When they had plowed, harrowed, and
planted, they looked forward confidently to
profits that should prove their judgment good
and sound. They had reason; flax was a
staple in the world's list of products. But
when the harvest was made they found them-
selves ruined. That was the plain fact,
though strange, enough. Unseasonable weather
had something to do with bringing on their
misfortune, but not all. The earth had done
her part, and they, her unfortunate partners,
had done theirs. They had planted and the
eartli had yielded, but between the harvesting
and the marketing a combination gathered
around the wheel of fortune at Chicago had
driven down the price of flax below the actual
cost of production. The partners owed for
their machinery, for their living expenses, for
mone the had borrowed on various accounts.

HOW ONE FARMER WAS RUINED

They waited a little to see if the market, now
manipulated downward, might next be ma-
nipulated upward again. Xo such change ap-
peared, and they gave up and were sold out,
going forth from their farm with scarcely the
price of a sandwich between them.

The older of the brothers was Arthur C.
Townley, a native of Minnesota, where he
had been reared on a farm and taught in the
local high-school. He had traveled widely and
observed much, sometimes as a land-seeker,
sometimes as a journeyman plasterer, for he
had managed somehow to pick up that trade
with other branches of human knowledge.
Farming he knew, probably as well as any
one that followed it — scientific and practical
farming. From the beginning he had been
on conviction enlisted against the various In-
terests that found the conditions I have de-
scribed the source of their profits. At one
time he had joined the Socialist party as an
available means of protest, and had been a
speaker in its service, but, accumulating a
disgust for its methods and a wise prevision
of its futility, had left it.

He was now ruined by a manipulated mar-
ket and sat himself down to consider why the
ruin and what could be done about such dis-
asters. Thousands of other farmers had been
ruined in the same way; under the existing
conditions still other thousands would walk

193

THE STORY OF THE NONPARTISAN LEAGUE

the same road into the same pit. It seemed
clear to Townley and to A. E. Bowen, a
friend of his who shared his views, that there
would never be a \vay for the farmer to
win clear and have a chance at a fair re-
turn for his labor until he had put forth his
power politically and obtained control of the
machinery of the state government. The
state was able to prevent most of the pilfering
that kept the farmer poor; able to, and bound
thereto, if laws and the American theory of
government amounted to anything. He saw
very plainly that most of the impositions
practised upon the farmer existed only be-
cause the state protected them. It was, for
instance, perfectly easy to remedy the crying
evil of false grades if the state honestly set
forth to remedy them. The state could put
a stop to extortionate money rates, false scales,
the tyranny of the railroads, the lawless com-
binations that fixed prices. The state could
come to the relief of the roped man of the
favorite illustration. Instead, it only held the
door shut against any one that wanted to
help him.

Every year the same influences nominated
the same kind of men to office; every year
the voters had the same choice of these or
nothing. All the world knew well enough
what were the influences and what the men
represented. In office they were bound ab-

104

HOW ONE FARMER WAS RUINED

solutely to do the bidding of those that had
put them in. The railroads, the "line" ele-
vators, the great grain and milling companies,
the banks, maintained a political organization
that ruled the state like a satrapy.

To think of combating this condition by
forming a third party was idle dreaming.
That experiment would have in North Dakota
always the result it had so far had; at the end
of it the System would be the stronger and
the farmer's lot the worse. Besides, it was a
fiction that North Dakota or any other state
or the United States was governed by a party.
The party was only a name. State and coun-
try were governed by influences that com-
bined back of the parties, so that no matter
which party might win at the polls the real
control would be the same. The secret of
power lay in that party control. In North
Dakota the railroads, the elevator companies,
the millers, and the banks had exercised that
control by directing the state conventions so
long as these made up the party tickets, and
then by dominating the primaries when these
supplanted the conventions under the newer
laws. The heart of the whole great machine
was the control of the primary; the primary
selected the candidate, and if the candidate
was of the Interests' picking he would do the
Interests' will in office— always, unquestion-
ingly, whatever that will might be.

14 1^

THE STORY OF THE XONPARTISAN LEAGUE

Yet if only enough farmers would agree to
stick by one kind of candidate in the primary
they would assuredly wrest the state into
their own hands and could pass what laws
they might wish.

For more than a year the bankrupted Town-
ley moved about North Dakota, turning these
things over in his mind and talking with farm-
'ers about them. He found a universal dis-
gust with the iron terms held out to them by
the Interests that controlled the grain market,
a general readiness to do something against
those terms, no distinct notion of what could
be done. But the more he traveled and
talked the more clearly he saw that the con-
trol of the primary was the essential of vic-
tory, if victory there was to be.

Much of his traveling was done on foot, he
being too poor to proceed otherwise. On some
days he walked thirty miles, for he is a lithe,
spare man, all muscle and endurance. As he
walked and talked a new agrarian movement
took shape in his mind.

The state is in area one of the largest in the
Union, and compared with some others is
sparsely settled. To attempt to organize it
was appalling. The farmers had been ap-
proached (and stung) by so many plausible
and talented persons with grand schemes,
from the regeneration of mankind to a new
kind of pump, that they had come to look

1S>6

HOW ONE FARMER WAS RUINED

upon every stranger that came into the barn-
yard as a probable bunco man. Very few of
them had ever heard of A. C. Townley, and
he had no way of securing introductions to
them. Nevertheless, he found himself, in
February, 1915, at the little town of Deering
and telephoning to F. B. Wood, seven miles
away, asking for an interview.

F. B. Wood was, and is, highly esteemed in
North Dakota for probity and judgment.
He had been one of the pioneers of the Equity
movement, wherein he wras a high officer, so that
the farmer's struggle was no novelty to him;
he knew all about it from long experience.

He expected Townley would appear the
next day. Instead, as quickly as a thin, active
man could walk the seven miles over the snow
the visitor shoved into Mr. Wood's house and
held out a sinewy hand.

''What the devil are you doing here at this
time of the year?" was the greeting he got.
Townley started on his narrative and Mr.
Wood listened without enthusiasm, for this
was about the thirtieth man that had told
him how to save the farmer. Still, as this
man talked, Mr. Wood, watching him nar-
rowly wTith a cool, blue eye and a naturally
shrewd mind sharpened with much dealing
in a practical world, began to sec that he
was different. Believers in the comfortable,
dull-clod theory about farmers should have

197

THE STORY OF THE NONPARTISAN LEAGUE

seen this meeting. Mr. Wood did not take
readily to Townley's scheme because he be-
lieved that in time the Equity's plan of co-
operation would prove all that the farmer
needed; and he did not take quickly to Town-
ley himself because he had been tutored by
experience to a low estimate of any man that
came to him to talk politics. Such a man
could have but one motive, which was for his
own advancement; whereas Mr. Wood had
long before seen that the North Dakota situa-
tion called for men that thought of the cause
as everything and themselves as nothing.
Nevertheless, he found his visitor interesting
— eyes as cold, shrewd, and steady as his own,
a long, clean-shaven, aquiline face, a strange,
abrupt, pointed, rather explosive manner of
talking, but a power of making what he talked
of perfectly clear, a power that amounted to
a rare gift. Moreover, he was endowed with
a persistence that seemed damnable, rugged
eloquence, and (what you would scarcely ex-
pect from his other endowments) a sense of
humor, sometimes cynical and sarcastic, but
never exercised about any subject except this
that overshadowed everything else, the eman-
cipation of the farmer.

For two days Townley held on, obstinate,
indefatigable, resourceful. He had not turned
this thing over and over in his mind as he
walked the lonely roads and prairie trails of

198

HOW ONE FARMER WAS RUINED

North Dakota without accumulating a reser-
voir of facts and pungent arguments. He had
decided upon what was necessary to be done,
and clenched his long, lean jaws on the task
of winning F. B. Wood to it. There were two
sons in the family — fine, intelligent, upstanding
youths — and when the father seemed loaded
with about all of Townley he could digest, the
tireless enthusiast turned to the sons. I tell
you the thing as it happened without trying
to dramatize a homely but critical incident.
At the end of two days' siege the family sur-
rendered. Mr. Wood fired up, and the sons
were electrified. The next morning Howard
Wood, the elder of the sons, loaded Townley
into the family Ford and went up the road
with him to talk to another farmer. They had
formulated a pledge or promise that all the
Woods had signed, and they now offered it
to the neighbors. The first day, thanks to the
Ford, they were able to see nine men, and got
them all. In six days they got seventy-nine,
and had not a refusal. If any tiller of the soil
seemed hostile or unapproachable, they took
him in the automobile for a spin down the
road, and both talked to him until they won
him over and he signed.

They went on thus until they hud three
townships in that county organized. Every
man that signed had to contribute his dues,
and I give it as an illustration of the financial

199

THE STORY OF THE NONPARTISAN LEAGUE

condition of the region that with all these
signatures they had not collected a cent of
money. Every fanner had paid in a post-
dated check; that is, a check dated the fol-
lowing October. It was February or March,
and the farmers had little money, and would
have little until they should sell the next
wheat crop. Therefore, the enterprise now
ran upon its first shoal. The projectors had
no funds and the gasolene was all gone; they
had used up all there was on the Wood place
and all they could beg or borrow. Howard
Wood met the emergency in heroic fashion.
He made out a note for twelve hundred dol-
lars; they took it to the bank, got it dis-
counted, and with the proceeds bought two
cars and a supply of gasolene.

They had three cars running now and post-
dated checks falling in like the snow. Town-
ley saw that with money his plan was certain
to succeed. F. B. Wood and his busy sons
called a meeting of farmers at Glenburn; all
the agitators talked to it, and that meeting
subscribed nine hundred and twenty-five dol-
lars, on the strength of which Townley was
able to secure two more cars and to send his
friend Bowen in one of them to wake up
another part of the state.

The Farmers' Nonpartisan League was the
name he had chosen for his organization. He
had conceived another idea that I submit only

MO

HOW ONE FARMER WAS RUINED

a born leader would have thought of or dared
to carry out. It was to fight money with
money; to raise a fund large enough to make
an effective campaign against the unlimited
resources of the other side, and to get this from
one of the poorest communities in the North.
He had the audacity to make the annual
dues six dollars — at a time when nine-tenths
of those to whom he must appeal were poverty-
stricken strugglers against bankrupting money
rates and ruinous market conditions. To ask
the new members to give so much as one dollar
for a new and not very alluring excursion in
reform seemed a desperate chance. Townley
had the wit to perceive that he could hope to
get it only by offering something tangible as
well as the distant prospect of better condi-
tions. He therefore made the six-dollar fee
include a year's subscription to the last pro-
gressive magazine left in the East, and a year's
subscription to the organ of the Xonpartisan
League when that should be published.

Even with these inducements the success
he met with seems phenomenal, and plainly
shows to what desperation the fanners had
been driven. They knew nothing about
Townley; for all they knew, he might be only
another variety of the swindler that had so
often tried to fleece them; another kind of
lightning-rod or driven-well or stock-food
schemer. On all sides it is admitted that Mr.

201

THE STORY OF THE NONPARTISAN LEAGUE

Townley has an unusual gift for organization.
To this must be added unusual powers of per-
suasion, but far beyond these he must have had
a cause of enduring vitality or he could never
have made his phenomenal progress through
North Dakota. In a short time he had many
organizers at work enrolling members and tak-
ing subscriptions on commission.

This feature of the work has been much
criticized, but. I do not know how else it
could have been done. The canvassers re-
ceived a percentage of the checks they col-
lected, and it seems to be the view of the
critics that they should have done the work
for nothing. I may note here that all these
critics are and were opposed to the forming
of the League, anyway, and it is likely that if
the service had been gratuitous they would
have discovered some other fault in it. There
may be men that could afford to give freely,
in a spirit of beautiful altruism, the time and
hard labor necessary to secure these mem-
bers, but assuredly they would be men that
would not know how to address the farmers of
North Dakota, in the first place, and would not
care to do it, in the second. The farmers'
cause was a poor man's cause; if it had been
a rich man's cause there would have been no
need to seek enlistments for it; and being a
poor man's cause, those that gave their time to
it must have their pcr-dicm revenue or starve.

20*

CHAPTER XII

THE FIRST VICTORY

IN a short time Townley had 10 automo-
biles rolling through the state, with can-
vassers inside of them taking subscriptions
and enlisting members; then 20, then 40, and
then CO. He bought machines, ran in debt
for them, chartered them, borrowed them.
Steadily the figures of membership went up.
By July he had 10,000, and when in Septem-
ber the League's newspaper, The Nonpartisan
Leader, made its first appearance, it had
22,000 subscribers, every one of them a mem-
ber of the League.

It was about this time that the old-school
politicians of the state woke up to the real
nature of the work in hand. After all, some
advantages pertain to obscurity. Townley?
Townley? AVho in the devil is Townley? the
machine-leaders had said when they heard
vague reports about a new organization slowly
forming in the state. Nothing was more famil-
iar than farmer organizations; the junk-heap
was littered with their remains. One more

£0:3

THE STORY OF THE NONPARTISAN LEAGUE

might add to the gaiety of nations, but would
never threaten those that had sat so long in
the seats of the mighty they had come to
believe the seats their own. "With the ap-
pearance of the Leader they awoke with a
start. Twenty-two thousand members in
about seven months were too significant to be
ignored. In their own phraseology there was
something doing, and from that moment on
the League, bursting into sudden publicity,
was obliged to fight its way inch by inch.

The first device was to try to prevent the
farther spread of the movement. Newspapers
in the state that were owned, controlled,
financed, or influenced on the side of the
coterie known as the Old Gang, vehemently
warned the farmers against what they termed
"a band of swindlers now traversing our
state and defrauding our farmers through
subscriptions to a mythical new political
league," and the name of the "Six-dollar
Suckers" was invented for those that had
already yielded to the siren song of the ad-
venturers. All such were daily advised that
they had lost their money, and others not yet
approached were strongly urged to take down
their fowling-pieces if they saw the League
canvassers driving into the yard. Under
these incitements many canvassers of the
League were arrested on charges of conspir-
acy to obtain money under false pretenses,

"

THE FIRST VICTORY

and some of the members, becoming panic-
stricken, wrote in to withdraw their sub-
scriptions. I was in the state at this time
and could not well fail to observe two facts.
The attempt to stampede those already signed
fell short, although it was well planned and
zealously carried out. When sifted down, the
number of the frightened compared with the
number that stood steadfast was so small that
everybody laughed at it. And next, the cam-
paign of the opposition was not really injuring
the League, but in a way helping it. I saw,
for instance, scores of letters from new mem-
bers ironically exulting in the fact that they
were "Six-dollar Suckers," and expressing the
belief that the supply of such suckers would
not run out so long as the present conditions
existed, or some comment to the like effect.

To any one that knew the state fairly well
this had much meaning. It had always been,
as Doctor \Yorst said, the jocular assumption
of the old-school politician that the farmers
would never unite. Perhaps rosy-lined hope
had much to do with this bright thought:
if the farmers ever should unite, of course the
old-school politicians would be without em-
ployment, since 80 per cent, of the state's
population was engaged in farming. In truth
the existing control of the state was a most
absurd and illogical thing, and every intelli-
gent man knew that it was so. The govern-

£05

THE STORY OF THE NONPARTISAN LEAGUE

ment was conducted by lawyers, an element
constituting a fraction of 1 per cent, of the
population; farmers constituting 80 per cent,
had nothing to say about the business. Even
the lawyers, again, could not be said here,
as in some regions, to be chosen because of
superior wisdom or skill in lawmaking. On
the contrary, they were chosen by the rail-
roads, the elevator companies, the millers, and
the banks (all of these being Interests outside
of the state), and by these chosen because of
their superior ductility in the hands of those
that had chosen them.

It is hard to deal with these things without
seeming to be partisan or bitter, and I have
no impulse to be either. The facts, as learned
by every fair-minded person that investigated
them, were much worse than I have indicated,
so that North Dakota was a political grand-
duchy with a governing class as rigid as the
nobility in a German principality before the
war. This anomalous condition of rule by
the minority was possible only because the
farmers had always failed to vote together.
On any appearance of union among them the
whole structure of corporation government
would have blown up. Therefore, the alarm
of the old-school politicians was natural and
well founded when they beheld a union of
farmers that could not be terrified, but that
manifested a grimly fixed purpose to rule,

2UG

THE FIRST VICTORY

and it is from this time that one may date the
discovery already mentioned that the men con-
ducting the League were of bad character.

One of the charges brought most industri-
ously against it was that its affairs were not
democratically directed. I observed this to
be urged violently by persons that had never
otherwise shown the least concern for democ-
racy and by some that habitually sneered at
it. Yet I can never pretend that the charge
was without foundation. The League was
managed much after the example of the great
corporations that it must do battle with.
The direction was mainly in the hands of a
few members; the president, who was Town-
ley, and an executive committee of four other
persons assumed the duties of leadership.
The natural assumption was that this was
done to gratify a lust for power. Among this
mortal race of ours motives are complicated
things, and about all we can be sure of is
that nobody does anything for but one reason.
I think it quite likely that Townley enjoyed
the fact that he wTas president of the League.
If the founder and builder of the thing had
no such sensation he would not be human.

But the main reason went far beyond this.
If the League was to do anything to lift the
load from the farmer's back it would have to
fight a long, desperate, and doubtful contest
with the wiliest, most resourceful, most po\v-

THE STORY OF THE XOXPARTISAN LEAGUE

erful, most ably generated corporations in the
United States. They would be supplied with
unlimited money, with an army of spies,
adroit lawyers, another army of agents, a
large part of the press. Democracy is the
soul of progress and the hope of the world,
but to hurl against the might of the corpora-
tion an association of farmers wherein all
should be generals and all maneuvers debated
at the street corners would be to attack a
great and well-disciplined army with what
Bismarck once called a mob of fighting per-
sons. When the enemy approached in attack
it was useless to send against him a company
of naked gentlemen armed with bows and
arrows. They might be as democratic as
heart could desire; they would be rolled up
in that unequal combat. Only two or three
commanders would know the plans of the
enemy; all the world would know the plans
of the League; and what was at hand was
essentially war.

Xorth Dakota's next general election would
be held in November, 1916, with the prima-
ries coining in June. The control of the state
would be decided at the primaries. Whom-
soever these might choose in June would be
elected in November.

A state convention was called to meet at
Fargo and nominate a state ticket. It con-
sisted of one delegate from each legislative

*08

THE FIRST VICTORY

district, who had been chosen by a legislative
district convention consisting of delegates
elected at precinct meetings of League mem-
bers. Much complaint was made of this sys-
tem— by persons outside of the League — on
the ground that a slate had been prepared in
advance by the insiders, and the convention
was nothing but a rubber stamp. This was
called boss rule and likened to the practices
of Tammany Hall and other horrible monsters
of our political dreams. I could never find
a member of the League that seemed to feel
his inalienable rights had been thus denied
him, and certainly the voting along the line
for district and state delegates would seem to
give an adequate chance to anybody that
wished to smash the slate.

In the main the work of the state conven-
tion was well done, and justified the slate sys-
tem, if that is what was responsible. It
picked as the candidate for governor a re-
markable man that certainly would have re-
mained in obscurity to the end of his days
if a pure democracy had reigned in the League
method. Almost unknown was this reserved,
scholarly, university graduate living upon
a farm about nine miles from any given
point, a sturdy, level-headed person whose
previous ambition had been to be a good
citizen and cultivate the soil with scientific
skill. The executive committee heard of him

THE STORY OF THE XOXPARTISAX LEAGUE

in the midst of a consideration of twenty other
candidates, and was so much impressed with
the accounts that it sent hot-foot after
this wonder. It found him a perfect Cin-
cinnatus, although unconscious of the fact.
Clad in overalls, he was steering a load of
fence-posts over the bleak prairie, and wound
his reins around the handle of the brake when
he stopped to greet the messenger summon-
ing him instantly to Fargo on grave business.
His knees knocked together when he finally
grasped the fact that some persons wanted
him to be governor; he had never made a
public speech in his life. Whatever divina-
tion led the committee to his gate was in this
respect soon verified. There were in him all
the time the makings of an effective, easy,
and forceful public speaker that would have
persisted unknown to the end of the chapter
but for this circumstance. The campaign was
still young when lie had forgotten all about
his fears of the platform, and could stir an
audience as well as any of the old hands at
this recondite art. Character was a great
asset in his campaign; his neighbors pro-
foundly respected him as one with an un-
blemished record for straight, open dealing
with all men. Next to that was what you
might call his stage presence; he was well
set-up, with the frame and healthy color of
an athlete, which was not strange, seeing he

THE FIRST VICTORY

was an old football-player; Lynn J. Frazier
was his name; none of those that were in
college with him was likely to forget it.

With the candidate for governor picked in
this manner there was offered to the voters
a full state ticket, including candidates for
justices of the supreme court. We have no
need to conceal the fact, this being a summary
of its work and not an advocate's brief, that
the management made many errors. Nothing
else was to be expected. Not one of the
executive committee, which did the most of
the steering, had any experience in public
affairs or pretended to any great skill in the
judging of men. The candidate for lieuten-
ant-governor, a storekeeper named Kraabel,
was ill-chosen, and in later days sorely plagued
the League. In the way of practical wisdom
the choice of the candidate for state treasurer
was an error, although the man was able and
perfectly honest. But he had an Irish name,
the opposition succeeded, through some un-
scrupulous maneuvers, in befogging and dis-
torting the real issue with questions having
naught to do with it, and the man that
eventually ran against him was popular and
had a good old Swedish name.

Nearly four thousand persons from all parts
of the state came to a mass state convention
at Fargo, April 1st, and indorsed with joy-
ful cheers the selections that had been made.

15 *U

THE STORY OF THE NONPARTISAN LEAGUE

The League had now forty thousand members.
It was no longer a movement to be ignored or
sneered at. Forty thousand farmers voting
together within the dominant party could
control the state, and every politician knew
that fact only too well. For you must under-
stand that the state ticket acclaimed by this
convention related with the one exception of
the state treasurer to the Republican primaries
in June, and the nominations amounted to
nothing but this, that these candidates were
recommended to the Republicans of the state
as the best to be voted for at those primaries.
This point is important because the whole of
the League's tactics swung upon it. The
League was never a political party. It was
and still is no more than an organization to
secure the nomination of candidates whose con-
victions are, or are believed to be, in harmony
with the program of the League. In other
words, the farmers had adopted Townley's
idea that the mastery of the primaries was the
mastery of the state and were acting definitely
and deliberately upon that principle.

It was now applied to the selection of can-
didates for the legislature. Each county (or
legislative district) had its convention, and
these conventions, chosen by precinct cau-
cuses, had the task of making the selections
for representative and senator. I should ex-
plain here that the term of a state senator in

THE FIRST VICTORY

North Dakota is four years, each senator
serving through two sessions of the legisla-
ture; but a representative holds office only
two years. That is to say, the entire lower
house is elected anew at every general elec-
tion, but only one-half of the senate. This
fact had an important bearing, as you will
soon see, on the first experiences of the League.
I spoke a moment ago of the program to
which the candidates were supposed to be
committed. Hereafter persons that go over
these records will be much puzzled to account
for the violent outcry that was made over
this. For when all was said and done, what
was it that was denounced as subversive of
society, as violent revolution, and the rest?
Principally the carrying out in a republic of
the will of the people as expressed at the polls.
Here is the printed program that was sub-
mitted by every canvasser of the League to
every farmer whose support he asked; the
original document that every member signed
and thus accepted after it had been read and
discussed to him:

PROGRAM

State Terminal Elevators, Flour Mills, Stock Yards,
Packing Houses, and Cold Storage Plants.
State Hail Insurance.

Exemption of Farm Improvements from Taxation.
State Inspection of Dockage and Grading.

Rural Credit Banks Operated at Cast.

213

THE STORY OF THE XOXPARTISAX LEAGUE

There followed on the pledge these com-
ments :

North Dakota farmers LOSE MILLIONS OF DOLLARS

EACH YEAH.

We can SAVE as much of this as our Organization
compels the MIDDLEMEN* to GIVE UP — THE STRONGER

WE ORGANIZE THE MORE WE CAN KEEP.

Therefore, we the undersigned, to secure the enact-
ment of such legislation, each pledge ourselves to aid
and support the work of organization by paying an
amount equal to seventy-five cents per month or nine
dollars l for one year. This sum to include cost of
organization, subscription to Pearson s Magazine and
The Xonpartisan Leader (official paper of the Farmers'
Nonpartisan Political League) and membership in the
League to December 1, 1916.

It is understood and agreed: first, that the work of
organization and investigation herein contemplated is
to be carried on by and under the supervision of an
executive committee of five men; second, that the mem-
bers of this League will use their best efforts to secure
the nomination and election of men for office within
the state, whom the investigations of this League show
by conviction, record and conduct do approve and will
support legislation necessary for the purposes above
expressed.

This would seem to be about as lucent
as plain speech could make it. Also it was
about what the average farmer was thinking.
Hardly six months had passed before a special
campaign was made against it by visitation,
personal effort, addresses, and the ceaseless

'The original duos of six dolLirs were increased to nine dollars as
the work of the League broadened.

214

THE FIRST VICTORY

efforts of a large part of the press ; yet scarcely
any farmer that ever signed one of these
pledges averred he did not fully understand
or approve of what he had signed.

The only innovations in this program likely
to disturb seriously the peace of the conser-
vative-minded were those connected with state
enterprises. But the people had voted for
state elevators and state hail insurance, and
the state flour-mills and packing-houses might
be deemed a tolerable experiment if the state
was to have its elevators. Wherein the other
reforms could be viewed by reasonable men
as "anarchistic," "of the torch and ax," "ex-
travagant," "destructive," or "vilely radical"
I think no one will be able to say, but all of
these terms and others still worse were applied
to them. You would have thought that
North Dakota had been invaded by a band
of furious, ravening, uncouth savages bent
upon the uprooting of civilization itself. I
assure you that statement will seem no exag-
geration to any one that will take the trouble
to read the press of the Northwest after it
had been successfully awakened to the fact
that the League was likely to carry the state.
A majority of the people, American citizens,
purposed to exercise their constitutional right
to govern, and at the bare idea the founda-
tions seemed to rock.

But the real cause of the excitement was

(215

THE STORY OF THE NONPARTISAN LEAGUE

not that the majority purposed to govern,
but that the minority was likely to be dis-
possessed, and that with the passing of this
abnormal condition there might pass also the
whole golden network of privilege and profit
that had been woven around minority control.
It was this that caused the shudders and con-
tortions of horror, not the palpable fiction
that the farmers' organization was a hideous
monster from the anarchistic lairs of fetid
Europe, bedecked with horrible red flags.
Behind the farmers appeared the likelihood
that some day false grades might be abol-
ished, wash sales eliminated, and the mixing-
house might cease its wonders to perform.
In plain terms, excessive and long-enjoyed
profits were put in peril, with the true historic
result.

Since we are on this subject we may as well
have the whole truth and own that something
also is to be allowed for the fact that the Sys-
tem had come to have a certain powerful sup-
port in the feeling of social caste. There were
those that could have no direct interest in
the dividends at stake yet looked upon the
League much as the dukes and fine ladies
looked upon Jack Cade's rebellion. Low, in-
ferior creatures were rising against those of
the better station, to whom God in His wisdom
had committed the property interests of the
nation and likewise its lawruaking machinery.

THE FIRST VICTORY

You will find to this day, in every city of the
Northwest, a certain element that opposes
the League on exactly this impulse. The
farmers always had submitted to the guidance
of those that knew what was best for the
state. Were they going nowr to upset this
pleasant arrangement like a bull thrusting a
horn under a parterre?

For these causes and others, like the dis-
solving of the chances of personal ambition
before the eyes of many a politician of the old
school, the League, from the moment it re-
vealed its strength, was fought with a relent-
less energy that often amazed the onlookers,
and with a variety of skill and resource that
in a long experience I have not known to be
surpassed anywhere.

At this first state convention, for instance,
no time was wasted by the opposition upon
ancient and familiar tactics. No attempt was
made to convince the farmer that all was
really well with him, and he had no just cause
of complaint. Instead, the assembly was
swept with a succession of rumors cleverly
designed to awaken alarm or to cause distrust
of the League. The most of these related to
the legal aspects of the case. Good lawyers
were said to have declared that the League
was wholly unlawful and its candidates could
not be admitted to the official ballot. An
action was about to be begun against Town-

217

THE STORY OF THE NONPARTISAN LEAGUE

ley and others for obtaining money under
false pretenses, since the organization was a
manifest fraud. Newspapers declared that
the League officers would be arrested in open
session of the convention and their books and
papers seized as the property of an illegal
body. The League was a copartnership;
hence all its members were responsible for
all its debts. Farmers were warmly advised
that as the League could never have any
standing under the law, they had better leave
the convention and cease to be fooled.

Great bundles of cunningly worded circu-
lars conveying such news were sent up from
Minneapolis by night and distributed among
the delegates as they left the hall at noon;
but when the League officers themselves
pasted these circulars on the walls of the
building and read them (with comments) to
the reassembled convention, the effect of
this particular strategem seemed largely to
be lost.

The campaign for the primaries opened the
day after the convention adjourned and was
carried on in every part of the state, and
always with increasing temperatures, it seemed
to me. The opposition is to be credited with
a desperate stand against what was soon seen
to be certain defeat. For the clenched de-
termination of the farmers was unmistakable;
neither appeals to party loyalty nor the elo-

THE FIRST VICTORY

quence of once popular leaders could move
them. What old-school politicians had said
could never happen was upon them; the
farmers had arisen to vote for themselves.

The primaries came on at the end of that
campaign, in which Frazier and the other can-
didates visited every part of the state, and
when the votes were counted that night the
League was found to have swept to victory
with pluralities of about seventeen thousand.

That meant, of course, that it would carry
the state in the November election; it meant
that the old machine was tottering to its fall.
As a parting shot it sought to becloud the
situation with an ingenious trick. The Dem-
ocratic party in the state was split, one fac-
tion being called radical and the other con-
servative. The machine arranged to have the
conservative element withdraw and leave the
choice of a candidate to the radical wing.
This nominated a candidate of convictions at
least as advanced as those of any Leaguer.
The object of this was to deprive the certain
election of Frazier of any radical significance,
since he was of the two rather the more or-
thodox in his opinions, and his victory might
be misreported as, after all, some triumph of
conservatism. The Democratic candidate,
with a degree of self-abnegation hardly to be
expected in a fight between parties, check-
mated this move by practically advising his

219

THE STORY OF THE NONPARTISAN LEAGUE

followers to vote for Frazier, who won by
about sixty-five thousand plurality.

All of the League's selections, with the ex-
ception of the good man with the Irish name
who ran for state treasurer, went in with him,
including three members of the supreme
court, now for the first time filled by the
choice of the farmers instead of the oicking of
lawyers.

In the same election President Wilson, on
the Democratic ticket, carried the state by
about 1,400 — a result no one had expected,
not even the most sanguine Democrat, and
marking a strange innovation in North Dakota
affairs. On state treasurer the vote was close,
the League candidate, who was on the Demo-
cratic ticket, receiving 51,149 votes against
51 ,349 for his opponent. The vote on supreme
court justices may be taken as a fair index of
the League's normal voting strength at the
time. The first League candidate received
62,675; the second, 61,109; the third, 51,170:
votes for the others were 44,028, 43,442, and
37,980.!

As to the legislature, it was seen tiiat the
League had won in significance an overwhelm-
ing victory, and yet that the fruits of that
victory would be largely lost to it because of

1 There vrcre six candidates. Under the law, the three receiving
the highest vote were elected. The three League candidates ran
against the field.

220

THE FIRST VICTORY

the constitutional provisions about the make-
up of the senate. This is the summary of the
legislative results:

House of Representatives, Fifteenth General Assem-
bly, state of North Dakota.

Total membership 113

Total Republican members 97

Total Democratic members 16

Elected by the League 87

Elected, not by the League 20

Seventy-two of the Republican representatives and
1,3 of the Democratic were League members.

Senate, Fifteenth General Assembly, state of North
Dakota.

Total membership 49

Elected in 1916 election <i>

Holdovers from election of 1914 24

Republicans 48

Democrats 6

Elected by the League, 1916 18

Necessary for majority £5

Fourteen of the Republican senators elected in 1916
were League men, and 4 of the Democrats.

There were 49 senatorial districts in the
state, electing senators alternately. In the
election of 1916 only seven senators of the old
school had secured seats, but there were 21
of that kind left over from the election of
1914 and these gave the old machine a
majority of 7 against the League.

THE STORY OF THE NOXPARTISAN LEAGUE

The make-up of committees in the senate
is in the hands of its presiding officer, the
lieutenant-governor, and it was here that the
League managers discovered another of their
errors. Lieut. -Gov. A. T. Kraabel, who had
been indorsed by the League, made up the
committees against the League's program.

When they could no longer avoid this fact,
furious protest arose from the League's lead-
ers. For these things there is never any rem-
edy in our system of government; they are
the still outstanding defects of democracy.
Mr. Kraabel afterward explained his change
of front on the ground that he had lost con-
fidence in the League's leaders, and particu-
larly in Townley. I set down the explana-
tion for what it may seem to the reader to be
worth.

But the truth was, no matter what may
have been the motives at work, the chief
tiling in the League's reforming regimen was
off for that session, and men of less iron in
their composition might have looked upon the
situation with disgust. The result of so much
hard labor, so many arguings, so much
thought and hope, seemed little better than
nothing. Victory and the real power, in spite
of the election, remained where they had
always rested — with those that oppressed the
farmer. The election had been fought pri-
marily on the issue of the terminal elevator.

THE FIRST VICTORY

The outcome was a third mandate from the
people to proceed with that project. The
third mandate was now negatived as easily as
the first and the second had been. That being
the case, the most optimistic member of the
League might reasonably ask himself what
was the use of this line of attack, and wonder
if in America Jefferson's famous theory of the
consent of the governed as the basis of govern-
ment had slipped into the region of folk-lore
and myth.

CHAPTER XIII

"THE FARMERS' LEGISLATURE"

T I iHE test issue in North Dakota 'was the
A state terminal elevator, to defeat which
at all hazards became the dearest aim of the
reactionaries. The session of 1917 showed
their resources in cleverness to this end. The
League proposed a bill to amend the Consti-
tution at a special election to be held the
following June, with a special session of the
legislature to be held at once thereafter. This
was to provide the necessary acts for state-
owned mill, elevator, and the rest of the pro-
gram. To frustrate this plan and ruin the
project no fewer than eight bills (counting
both houses) were projected in this session,
each purporting to provide the elevator and
each suggested for the express purpose of de-
feating it.

One of these, for instance, planned, through
an adroitly managed maze of words, that the
state should build the elevator and then de-
liver it to private interest to be operated.
Another, seemingly fair, made such provisions

"THE FARMERS' LEGISLATURE "

about the financing of the enterprise as would
have been utterly impossible in practice and
would have led the state to bankruptcy.
Another cunningly provided that the elevator
should be turned over to the Society of Equity,
evidently in the hope that this would cause a
division between the League and the Equity
adherents. One bill of this order, introduced
in the last moments of a busy and troubled
session, actually got through, but was promptly
spiked by the good sense of Governor Frazier,
who vetoed it; and the great issue of elevator
or no elevator was left still unsettled after six
years of agitation and three declarations from
the people.

Yet it is only fair to say that while the
chief things in the League program were made
impossible, the legislature thus composed,
part reform and part reactionary, enacted
more advanced and reform laws than all the
other legislatures together that had met since
the state was launched. The reform majority
in the house continued always to pass reform
measures and the reactionary majority in the
senate to kill as many of these as it dared to
kill. But the reforms came too fast; it was
not in the courage of man to kill them all,
and not quite safe. After the deliberate
slaughter of one measure upon which the fann-
ers had set their hearts, it would be a bold
politician that went forth openly to kill

THE STORY OF THE XOXPARTISAN LEAGUE

another. The farmers at home were daily
growing more vindictive against the men that,
in the current phrase, had sold them out, and
it was back home that the legislators must
wend wrhen the session should be over. To
this, to the indefatigable zeal and good gen-
eralship of the reformers, and to the moral
influence of the fact that the state had voted
overwhelmingly for a certain policy and
twenty-eight men were conspiring to defeat
the will of the mass majority, we owe this
really extraordinary body of laws passed by
the Fifteenth General Assembly of North Da-
kota, January and February, 1917. Here are
some of them:

1. Three laws to abolish three ancient abuses on the
part of the railroad monopoly. As I have related, one
of the potent methods by which the combination of
Interests fought the growth of co-operation in the
Northwest was by refusing or failing to supply cars to
co-operative elevators. The legislature passed a law
to compel railroads to furnish cars to all shippers alike.
I do not know anything more eloquent of the conditions
formerly prevailing in North Dakota: for observe
that to secure an act of such obvious justice a
political revolution was necessary.

The next law wa,s of the same order and same origin
— to compel railroads to furnish sites for elevators and
warehouses along their rights of way. AYith these two
weapons stricken from the hands of the combination,
the co-operative movement for the first time began to
have a fair chance to live.

The third law, compelling railroads to furnish side-
is! u

"THE FARMERS' LEGISLATURE"

tracks at mines, was in the interest of independent
coal-producers and against the coal trust, which, like
all the others, operated in connivance with the rail-
roads. Please note that all the trusts, from money to
peanuts, had always the active support and assistance
of the railroads — a phase of our social and economic
problems that we in this country have all to ourselves
and are likely to keep so.

2. An attempt was made to deal with the burning
question of false grading by a law requiring all eleva-
tors and grain warehouses to be licensed by the state.
The idea of this act was sound and good, but the only
form in which it could be juggled past the reactionary
twenty-eight was a form that was largely inoperative.

3. Under the foregoing act, a law to better the prac-
tices of grain weighing and grading. The elevators
being now nominally under the control of the state,
false grading could be punished by the revoking of a
license. Beyond question this, although lamed in the
passing, marked a great advance, and in the following
season alone saved to the farmers much more than the
League ever cost them.

4. A law to encourage and protect co-operative socie-
ties. This reform the co-operatives had for many
years sought from the legislature in vain, though it
was no more than rudimentary justice. It gave co-
operation a chance to defend itself against stiletto work
and poison gas.

5. Enlightened legislation to further good roads in
North Dakota, where of all places on earth they were
most needed.

6. Legislation to protect and foster the dairying in-
dustry. North Dakota has great possibilities in dairy-
ing, for in spite of the cold winters cattle thrive there.
If I say that until the farmers got into the legislature
no attention could be had to this potential source of

16 **7

THE STORY OF THE NOXPARTISAN LEAGUE

wealth, I may be deemed to speak from prejudice an
improbable thing. Yet so stands the fact; not from
malice, of course, but because a legislature of lawyers
selected by railroad agents — what could that know
or do about dairying?

7. I/egislation that began the great work of taxation
reform by seeking to compel railroads and other cor-
porations to pay something like a just share of the taxes,
and by instituting a graduated income tax upon large
fortunes.

This act, like some others of this session, was re-
garded by the reformers as marking but the beginning
of the necessary changes, yet as the best that could be
extorted from a legislature so constituted, wherein
twenty-eight senators had the power to veto the will
of the majority of the people.

8. Woman suffrage, so far as the constitution of the
state would allow. A law was passed granting the
ballot to women for national offices.

9. Educational reform. This embraced some ad-
mirable measures. Laws were passed to establish
county agricultural and training schools, to establish
evening schools for young men and women above the
ordinary school age, and laws to standardize rural
schools.

10. A law guaranteeing bank deposits and assessing
all the banks in the state to provide the guaranty
fund.

11. Administrative reforms. Laws combining cer-
tain offices, reducing allowances, and abolishing
sinecures.

CHAPTER XIV

THE LEAGUE AND THE WAK

UPON the securing of these reforms, those
of us that were observing the League ex-
pected confidently to hear next of its demise.
This would have been the natural develop-
ment and in accordance with all experience.
It had achieved a considerable part of its aim;
more, in fact, that any such organization had
any good reason to expect. There had never
been a legislature in the history of the United
States that in an equal space of time enacted
an equal number of betterment measures.
The full goal had not been reached, that was
quite true; on the terminal-elevator issue the
Interests were still defying the ballot-box.
But in all these things there had always been
elsewhere a certain percentage of what may
be termed bluff; reformers demanded the
millennium that they might get a water-pipe
mended; and we felt that in this case the
actual assets of the concern were so far ahead
of any other such effort that the fanners
would probably be satisfied and go back to

THE STORY OF THE NONPARTISAN LEAGUE

the fold of regularity. Besides, we argued,
there was the matter of dues; farmers were
not likely to go on to tax themselves at this
rate when most of the things they had wanted
seemed to have been won.

Also, such had been the history of all these
movements. The American people are in
politics molded to the two-party system, and
not likely in our time to depart from it. The
League, it is true, did not get away from that
system, but in fact kept carefully along with
it; still the League was an exotic, it was not
the regular, accustomed thing; it was not
hallowed by tradition nor sanctioned by the
fathers. Many similar segregations into the
Cave of Adullam had been known, and none
of them had lasted more than a year or two.
Hence, any tolerably facile seer in politics
could see the end of this.

But the Farmers' Xonpartisan League
showed no sign of going to pieces. Instead,
it grew stronger than ever. The name was
changed to the National Xonpartisan League
and the organizers moved with their never-
resting automobiles upon the neighboring
states. State branches begun to form in
South Dakota, Montana, and Minnesota.
The membership in North Dakota continued
to increase with hardly an effort made to
spread it. "What was still more wonderful,
and amounted to a portent in the eyes of any

230

THE LEAGUE AND THE WAR

old political reporter, the membership dues
continued to be paid without a murmur from
the rank and file. The annual tax, once nine
dollars a year, became sixteen dollars for an
"election bienniuin," or election period of
two years, and there went with it now only
a subscription to the League's organ, in some
states still in embryo.

A year after that first election in which the
League had swept North Dakota there were
20,000 more Leaguers in that state and 40,000
outside of it. In two years the total member-
ship had reached 150,000, fought at all points
and writh desperate ingenuity by the threat-
ened Interests in eleven Northwestern states.
This in spite of the war and the use of the war
situation in ways I am now to tell about, to
embarrass, to check, or to ruin the movement.

All persons familiar with the true nature of
the Great War had been aware from the first
that the United States could not keep out of
the conflict. In North Dakota men had been
so absorbed in the local struggle they had
never once looked out-of-doors to judge of
the great fight and what it meant. I have
said the League made grave errors. One of
them was about the war. League leaders did
not understand what was involved therein.
The fault was their own and they paid for it ;
they might have understood it if they had
taken the trouble to look and to study. There

231

THE STORY OF THE NOXPARTISAN LEAGUE

was, besides, the influence of the comfortable
doctrine, often preached, that certainly the
thing could never come here. Habit of mind
decides most issues in this world. For years
the minds of these men had been concentrated
on the one question whether North Dakota
was to be ruled from the Great Northern Rail-
road office in St. Paul or by its own people.
Even after April, 1917, the idea that the
United States could be so involved in the
European contest that the local issue must
be subordinated to the national knocked at
first in vain at such minds. No American
troops would ever be needed on that battle-
front; nothing would be at stake more im-
portant than some American dollars; and,
meantime, how about the great principle for
which they had fought so long? Was the
war raised to divert attention from that?

A covert but wide-spread propaganda was
carried on by the enemies of the Republic
through all the Western and Northwestern
states, insinuating and developing the idea
that the war was nothing but a rich man's
war, brought about to increase bonded in-
debtedness, favor the banks, and magnify
the dividends of corporations. Opposed to
this propaganda there was for months prac-
tically nothing on the side of the truth. The
German agents had the field to themselves.
Tli is fact will probably never be compre-

THE LEAGUE AND THE WAR

bended in the East, where the public was
undeceived from the first; yet it represents
a condition that, but for the innate and un-
conquerable patriotism of the people, might
have had historic consequences. For it was not
until the war was (for us) six months old that
the masses of the people in the Northwest had
any fair chance to know the facts about it. In
plain terms, the people there did not know what
the war was about; the most they knew was
that day after day they were assured, appar-
ently by persons well informed, that it had no
significance except as a means to increase the
fortunes of men already monstrously rich.

In these conditions the Nonpartisan lead-
ers committed the huge blunder of assuming
that the war wras of minor importance and of
steadfastly urging former issues as still of the
first concern. In the early days they made
some injudicious speeches in which this view
of the case was strongly phrased. It is not true
that they uttered any disloyal sentiments; I
think it is wholly untrue that they entertained
the least disloyal thought. They did no more
than to demand that the farmer's case should
not be obscured by this war brought on by
the exploiters, and that the government should
see that the farmer had a good price for his
products.

It is easier to acquit the Nonpartisan lead-
ers of disloyalty than of something else. They

THE STORY OF THE NONPARTISAN LEAGUE

did not know the importance or significance
of the Great War, but that was the very
tiling they should have known. It is to know
such things that men are made leaders. They
had never lifted their eyes from their environ-
ment to look at the great world abroad and
understand its relationship to their own prob-
lems, but exactly such understanding is what
is required of leadership. The sheer existence
in this world of the principle for which they
contended, the principle of democratic control,
was at stake in that war; the basis and cor-
ner-stone of their entire movement. If the
autocratic principle had won on the European
battle-field it would have won for all the rest
of the world, and the first of all the fruits of
its victory would have been a tightening of
the power of concentrated wealth everywhere—
North Dakota and everywhere else. No peo-
ple, therefore, had a more vital interest in
*.hat war than the people of North Dakota,
whose only hope of rescue from the autocracy
that oppressed them lay in the survival and
extension of the principle of democracy. The
leaders of the League did not at first see these
things, but exactly these tilings it was their
duty to see, and whatever trouble followed
they brought upon themselves; innocently, of
course, there is no doubt of that, but still by
their own dense blundering.

On the other hand, it is not possible to deny

THE LEAGUE AND THE WAR

that with all the rest of the wheat country the
Northwest had some reason to complain, and
more to be uneasy. The government fixed the
price of wheat at $2.20>^ for No. 1, at Min-
neapolis, the equivalent of about $1.85 at the
North Dakota elevator. But when that price
was fixed arbitrarily the market price for No. 1
at Minneapolis was $3.06. The growers,
therefore, by this order, underwent a loss of
nearly $1 a bushel. What made the case far
worse, they were unable to get any explana-
tion for this arbitrary reduction, nor was
there any appeal to them to accept it. At
the same time they saw that the government
steadily refused to fix any price for cotton,
for which the market was soaring unto un-
precedented heights. It seemed to them,
therefore, that the government was favoring
one section of the country at the expense of
another. The propaganda told them that this
was in the interest of the cotton speculators
in New York and once more illustrated the
assertion that the war was made for the
fattening of exploiters' profits. Even the
best-informed patriot might be excused if, in
these conditions, he resented the fact that 110
explanation was furnished to him. No one
need wonder, therefore, that some of the
League speakers objected vigorously to the
apparent discrimination.

Not with study and research could they

THE STORY OF THE NOXPARTISAN LEAGUE

have done a tiling more to the liking of their
enemies. At once the cry was raised that the
Nonpartisan League was a disloyal organiza-
tion. The most innocent remarks of its
speakers were twisted and distorted into
something that could bear the suspicion of
inferential sedition. At this development the
League leaders made their next blunder.
They did not perceive what this portended
and their speakers, unwarned, sometimes
made stupid or careless remarks. The next
thing that was known, a large part of the
Northwest had been inflamed against the very
name of the League.

Long after it had become apparent to every
thinking man that the League had been un-
justly accused and that its leaders were inno-
cent of any disloyal intent, meetings of League
adherents in some parts of the Northwest
were broken up by mobs, and the speakers
arrested or obliged to flee for their lives.
The chance to discredit and injure the move-
ment was golden and men saw it worked to
the utmost. All the fierce bitterness of
threatened profits and toppling privilege
came out in these intrigues. If the idea of
farmers' emancipation could be successfully
branded with disloyalty at a time when the
country's feeling was at its height, the
League could be crushed and need menaee
no one again. There is no doubt that agents

23G

THE LEAGUE AND THE WAR

were sent out from St. Paul and Minneapolis
in advance to stage some of these riots, and
little question that the enginery of the state
was in some instances, as in Minnesota, de-
liberately employed on the same side. One
speaker was mobbed for reading to an audi-
ence extracts from President Wilson's The
New Freedom; others were mobbed for read-
ing the Bible. Wherever it was known that
the League was almost ready to establish a
branch the efforts were redoubled to cause
some outbreak or breach of the peace that
could be used to the advantage of the milling
and elevator Interests.

One of these incidents had a national aspect
and perfectly illustrates the power of the in-
fluences at work to misinform the public as to
the League's intentions. Groups of pacifists
in New York, perhaps misled or misinformed,
but certainly assistant to adroit pro-German
and anti-American influences, joined in the
organizing of what was called the People's
Council for Democracy and War, the true
object of which was to set workers against the
government and thus hamstring its efforts.
A meeting of the Council's supporters was
held in Madison Square Garden, New York
City, and it was then decided to hold in the
West a national convention, so called, for the
purpose of spreading the gospel of pacifism,
which meant in this case opposition to the

237

TILE STORY OF THE NOXPARTISAN LEAGUE

government. The place selected was Minne-
apolis, but so great was the outcry of the
loyal part of the population there that the
governor of Minnesota forbade the gathering,
after many of the delegates were already on
the ground.

The projectors of the meeting, thus baffled,
planned now to adjourn to some neighbor-
ing state — Wisconsin on the east or North
Dakota on the west. They telegraphed the
governor of each of these states, asking If they
could expect there to be protected in their
constitutional rights. Each of the governors
responded in about the same terms, which
were, in fact, the only terms possible in reply
to such a query. Each said that the inquirers
would be protected in their constitutional
rights, but that those rights did not include
the right to preach sedition, and that any
seditious utterance would be promptly dealt
with according to law. Governor Frazier's
reply was particularly clear and pointed about
sedition, but by many of the newspapers this
part of it was omitted and nothing published
except the undertaking that constitutional
rights should be respected, and this was
twisted into an invitation to hold seditious
gatherings in North Dakota.

On this the cry went over the country that
the Nonpartisan League was furthering dis-
loyal conventions. The attacks upon it re-

238

THE LEAGUE AND THE WAR

doubled, and were presently aided by an un-
fortunate speech a United States Senator
conspicuous as an opponent of the war and
representing a state that contains a larger
percentage of persons of German birth or
descent than any other state in the Union.
He was addressing at St. Paul a convention
held under League auspices. Several versions
of his speech came to be extant, and eventu-
ally the Senator repudiated the versions that
were most resented. Because of his remarks
on this occasion he was brought before a com-
mittee of the Senate on charges, but in the
end these were dropped. What he said, ac-
cepting his own account of it, was highly ob-
jectionable to the majority of the people, and
the worst part of it was that while the League
had no responsibility for his utterances, they
were used extensively and industriously to in-
crease the feeling already aroused against the
reform movement. At that same convention
President Townley made a speech that may
be taken as a fair exposition of his state of
mind and that of the other League leaders
in those days. He said:

Let me try to make plainer still to you the reason
for the injustice in our industrial life. This war will
cost America maybe thirty, forty billions of dollars.
It is very difficult to raise so many billions of dollars.
It entails tremendous sacrifices on us all, a sacrifice
that we shall not shirk. Those billions will be spent

239

THE STORY OF THE NONPARTISAN LEAGUE

by this government to win the war for Liberty and
Democracy. Part of it will be spent for guns, part
for ships, part of it for coal, clothing, shoes, leather.
A part of it will be paid to those that are making
millions of profit out of the war to-day.

But a soldier boy cannot carry a gun unless there is
bread in his stomach. A soldier boy cannot dig a
trench unless he has a strong body made by bread.

And some of those billions of dollars have to be spent
to pay the farmers for the wheat to make the bread.
Now we have been calling for government control of
prices. And we got them all right. But in our clamor
for government control we overlooked the better tool.

We forgot, or neglected to see, that the representa-
tives of the profiteers were too large a part of our gov-
ernment, and so we got the government control too
largely in behalf of the profiteers. They are to-day
influencing this government in too large a measure.
Else they would not fix a price on coal twice what it
was before the war; else they would not be so long
reducing the price of bread after they have reduced
the price of wheat.

On another occasion he said to a meeting at
Jamestown, North Dakota:

Unless you do away with the gambler in food and
the necessaries of life you will produce your wheat
and get $£ a bushel for it, and then you will bond the
nation and pay across the water $o or $0 a bushel for
your own wheat for your own boy.

That is the line-up now. It is wrong. It is national
suicide. It is national suicide in times of peace; rt is
multiplied national suicide in times of war, and we are
not so crazy as to believe we can succeed unless this
government shall do what every European government
already has done — take over, absolutely take over

240

THE LEAGUE AND THE WAR

transportation, distribution, and kick out the gamblers
in clothing and food and machinery and munitions
and armor-plate and everything else that they are
using to make seven times as much money as they
made before the war — and God knows they made
plenty then!

Last Tuesday about ten million young men went to
the registration booths and there pledged their lives
in the defense of their country's honor.

This is the acme of patriotism. No blatant dema-
gogue approaches within a million miles of the sacrifice
these men made last Tuesday when they went to the
registration booths.

And it is right that they should have done it. I
believe in the conscription of life in time of war, be-
cause it is not right that the burden should be shoul-
dered upon those few who have the courage in their
blood to go out and fight.

I believe so thoroughly in conscription of life in time
of war that I believe the age limit should be raised to
take in all those that advocate war but do not go.

In time of national crisis and necessity it is the only
measure and the only way to raise an army. To try
to raise an army by the volunteer system is insanity.
Only by conscription can you get the best for war, and
only by conscription can you get the best to serve you
in office, in state, or nation.

Well, they have charged us with treason, but I
want to say to you that the farmers of this nation are
so patriotic that even though this government to-day
may be in the hands and absolute control of the steel
trust and the sugar trust and the machine trust; even
though it is, we are going to do our best by producing
all we can. All as it is, if we can't do better we will
do that.

You [those that profit from war] must make this
241

THE STORY OF THE NONPARTISAN LEAGUE

arrangement, that when we give our lives, all that we
have, this nation will take first of your profits and then
of the property you have got if the profit is not enough;
and after the war is over we will give back, as you give
back of our lives, as much as is left and no more.

No real patriot is likely to find anything
objectionable in this, but soon after it was de-
livered agents of the federal Department of
Justice were sent to investigate the League
and take note of the utterances of its speakers.
League champions assert that this was done
on representations from the imperiled Inter-
ests made at AYashington. The charge has
never been denied, but what is of more endur-
ing importance is that the agents found noth-
ing upon which to base either action or pro-
test, and the League, so far as they were
concerned, was allowed to go its way.

At one of its campaign rallies held at St.
Paul March 19, 1918, resolutions were adopted
declaring:

We and each of us hereby renew our pledges of
loyalty and devotion to our common country, and re-
affirm our unalterable determination to work always
for its best and highest interests and for the permanent
welfare of its people, our fellow-citizens.

Our nation is engaged in a great and terrible war, in
which we believe its purjxxses are the purposes of its
people, as given clear enunciation by the President
whom we have chosen to direct the administration of
our national affairs, to l>e right and just and worthy
the whole-hearted support of every good citizen.

242

THE LEAGUE AND THE WAR

Therefore we pledge our adherence to these purposes,
we commend our President for his faithful statement
of the intentions which are in the hearts of the American
people, and we assure him and our fellow-citizens of
our unqualified support of our government in its war
efforts.

It is, however, true enough that for months
after the declaration of war the majority of
the people of the Northwest remained in a
state of haze as to its real nature. In the
fall of 1917 Townley went to \Yashington
and conferred with the President, with George
Creel, chairman of the national Committee
on Public Information, and with others. He
came away with a clearer vision of the nature
of the issues involved and his first perception
that the life of democracy was at stake in
the world. Mr. Creel was one of the few
men in the government that saw that what
in the West had been stupidly called disloyalty
was nothing but lack of information. Else-
where it seems to have been taken for granted
that everybody knew everything without any
explanation. The Committee on Public In-
formation at once took up the task of en-
lightening those that had never considered
the causes of the war, and from that time on
there was no trouble, except with the actual
German and pro-German element, of which
North Dakota had no larger share than some
other states.

17 243

THE STORY OF THE NONPARTISAN LEAGUE

Mr. Creel afterward gave unequivocal tes-
timony to the loyalty of North Dakota under
the farmers' administration. In a magazine
article recalling the work of his department,
he wrote:

Three successive crop failures, and yet the farmers
of that state oversubscribed the first Liberty Loan 140
per cent.; the second, 70 per cent.; and the third 7G
per cent. With only one regiment at the outset, North
Dakota promptly recruited a second, and 3,887 men
entered the service as volunteers. The draft records
show that the cost per certified conscript in North
Dakota was $1.83 against an average of $4.23 for all
other states. In the last Red Cross drive North
Dakota's allotment was $200,000, and it subscribed
$575,000. Its Y. M. C. A. allotment was $100,000,
and it subscribed $175,000.

In 1918 North Dakota increased its wheat acreage
over 630,000 acres at the request of the government;
it was one of the first states to decree that all persons
between the ages of eighteen and fifty must be employed
in essential industry; also to provide a moratorium
protecting soldiers from foreclosure of loans.

Long after the crux of all these things had
passed Mr. Creel sent me the following still
more explicit testimony, which I am author-
ized to make public:

MY DEAR MR. RUSSELL, — I am not at all unwilling to
give you my opinion with respect to the war attitude
of the Nonpartisan League. Never at any time did I
consider it a disloyal organization. On the contrary,
the war record of the state of North Dakota, con-
trolled by the League, proved conclusively that the

244

THE LEAGUE AND THE WAR

membership, taken as a whole, gave America faithful
and ungrudging support in the hour of need.

There is no question, however, but that the Non-
partisan League in the beginning was poisoned by many
misunderstandings. Particularly was this true in the
matter of the lie that Wall Street was the cause of
America's entrance, and that the war was nothing more
nor less than the effort of rich men to increase and pro-
tect their profits. These beliefs, however, were not pe-
culiar to the Nonpartisan League, but were held by great
groups of workers and farmers of the Western States.

It was not a condition that should have caused any
wonder. During the long period of America's neu-
trality, press and politicians alike were divided on the
issues involved, so that April 6, 1917, found the people
of the United States mentally confused and emotionally
dulled. Nothing stood clear as a result of accusation
and counter-accusation, charges and denials, shouting
and abuse.

I sent for the heads of various agricultural bodies
and unions, and among those that came to Washington
in response to the call was Mr. Townley, head of the
Nonpartisan League. I found him, just as I found the
others, full of distrusts and suspicions born of the
many lies that he had read and heard. I took him, as
I took others, to the President himself, and the inter-
view removed every doubt as to the necessity of the
war and the high purpose of America. And after that
I took Mr. Townley to the office of Mr. Herbert
Hoover, and for three hours the two men fought out
disputed points. When Mr. Townley left Washington
he had not only pledged the full support of his organiza-
tion to the war, but he had struck hands with Mr.
Hoover and promised every co-operative effort. These
pledges were kept.

It was at Mr. Townley's request that I prepared to
245

THE STORY OF THE NONPARTISAN LEAGUE

send speakers into the Northwest — men and women
able to talk of the war as they had seen it, or else able
to discuss America's aims from every point of view.

It was what we were doing in every state in the
Union in our effort to remove misunderstanding, to
promote unity, and to kindle enthusiasm.

It was such speakers that the state administration
of Minnesota barred absolutely. It was not that they
questioned the loyalty of the speakers; in fact, they
asked for the use of them in their own campaigns. It
was simply the case that they did not mean to let the
Nonpartisan League hold meetings of any kind, even
loyalty meetings. What stood clear in my mind then,
as it stands clear to-day, is that Democrats and Re-
publicans alike feared the political power of the Non-
partisan League and did not want it to be given any
reputation for loyalty. In plain words, they preferred
that the Nonpartisan League should be disloyal rather
than loyal, in order that they might be provided with
a campaign weapon.

I am not familiar with the purposes or principles of
the Nonpartisan League. For all I know, they may
be good or they may be bad, but what I do know is
that the League itself had a better war record than that
of many organizations operating in the name of a 100-
per-cent. patriotism. In the Committee's fight for
world opinion, waged in even," foreign country, I never
found the Germans using the utterances of the Non-
partisan League or any of its niemlxrs, but in Mexico,
South America, Scandinavia, and the Orient I did find
the Germans employing constantly the reflections upon
America that were printed in partisan papers like The
Chicago Tribune, The Kansas City /SVar, and The Phila-
delphia North American.

Believe me, Very tru]y>

GEORGE CREEL

246

THE LEAGUE AND THE WAR

Judge Ben B. Lindsay, whose war services
to his country made him an unimpeachable
witness on these matters, writes this :

They [the enemies of the League] organized loyalty
leagues and public safety commissions, denounced the
Nonpartisan Leaguers as traitors, and proceeded to mob
them and deport them and indict them and tar and
feather them. The government at Washington sent
out speakers to the Nonpartisan League through the
Committee on Public Information. The local defense
committees refused to allow these speakers to address
public meetings of League members. The junkers did
not wish to have the farmers rallied to the support of
the war; they wished to have them marked as dis-
loyalists so that the Nonpartisan League might be
destroyed.

Thirty thousand North Dakota men were
enrolled in the armies of the United States.
Throughout the war the state administration,
in the hands of the League, gave an unblem-
ished example of devoted and most loyal
support to the national government, and
when the war was over a legislature wherein
the League had a clear majority in both
houses passed, as we shall see later, the
broadest and best soldiers' bounty bill that
had been enacted in the United States. But
Judge Lindsay's diagnosis is probably cor-
rect. The hatred generated among the bene-
ficiaries of the existing system was so intense
that any means likely to destroy or weaken
the League was welcome to them. The great-

247

THE STORY OF TIIE NONPARTISAN LEAGUE

est fault of the League leaders was that they
did not from the beginning perceive that this
would be the case and put themselves upon
guard accordingly.

This carelessness and the extreme rancor of
their enemies brought about the extraordinary
indictment of President Townley and another
in a remote corner of Minnesota for alleged
disloyal utterances. As this case is at the
moment pending before a state court it may
not properly be discussed here. But to those
that know the facts they bear a comment
that, it may be believed, will eventually be
apparent to the world.1

1 Grand Forks is a city of the state that is not usually deemed
friendly to the League. I find that a meeting held at Grand Forks
in the days when the League and its officers were most undergoing
attaek, passed (with only two dissenting voices, I am told) this
resolution:

"We, two thousand citizens of North Dakota, in mass-meeting
assembled, this, the 30th day of March, 1917, at the auditorium in
Grand Forks, do hereby express our confidence in A. C. Townley,
president of the Nonpartisan League, in the management of said
organization; and we do hereby resent the misrepresentations and
falsehoods published in the press, especially The Grand Forks Herald
and The .\ormandcn, which press we believe to be controlled and
directed by large corporate interests within and without the state,
against A. (.'. Townley, and we wish to warn such press that any
insult tn Mr. Townley or the Nonpartisan League will be considered
a personal insult to all of us, and we earnestly request the people
of Grand Forks, and all the citizens of the state, to fully inform
themselves on the aims and purposes of this farmers' organization.
This we do for the good and welfare of all the people."

CHAPTER XV

THE FARMERS IN COMPLETE CONTROL

FOUGHT at every step relentlessly and by
methods such as these, the League through-
out 1916, 1917, 1918, continued to make pro-
gress in the Northwestern States. For the
election of 1918, Governor Frazier was re-
nominated with great acclaim; even the ene-
mies of the League admitted that his ad-
ministration had been clean and able. In
picking some of the other candidates for
state officers, the League, as subsequently ap-
peared, blundered seriously so far as its own
interests were concerned. No one has yet
suggested a way by which these errors can be
avoided under the operations of democracy.
Perhaps an autocrat on his throne, if he have
wit enough, can find infallible assistants or
get rid quickly of any that turn in his hand.
Under democracy the door is open to personal
popularity on one side and personal ambition
on the other, and a host of troubles often
comes trooping in with both.

In the election the opponents of the League

249

THE STORY OF THE NONPARTISAN LEAGUE

put forth all their strength, for they knew
that this contest was decisive. The bogy of
disloyalty was worked to its utmost, for the
war was still on while the campaign was
waged, and the opportunity afforded by the
indictments, however unsubstantial these
might be, and by the carefully worked-up
feeling in some quarters of the state, was
naturally too good to be lost. Nevertheless,
the League carried the state by 17,784 on this
severe test of its strength, and, with the full
state ticket, elected a majority of senators and
representatives, thus obtaining complete con-
trol of the legislature.

All legislative obstacles to the carrying out
of its program were now removed. There
were no hold-over senators to block the will
of the majority of the voters of the state.
What in the opposition newspapers had been
called "Townleyism" was triumphant at last
and the rest of the country was in a position
to judge of its devastating purposes. It had
been described to the uninitiated as "anar-
chistic," "bolshevistic," "red radical," as the
dream of madmen and the plot of depraved
enemies of all social order. Its leaders had
been drawn to the complacent East as wild
men of the woods, unkempt and shaggy, de-
scending with blight upon civilization. Com-
ments by even the most deliberate part of
the Eastern press showed plainly that no-

&50

THE FARMERS IN CONTROL

thing there but cataclysm was expected, and
so strong was this feeling that when the
legislature controlled by these disturbers of
the public peace assembled at Bismarck, the
capital of the state, in January, 1919, many
of the leading journals of the East sent special
correspondents to the spot to report the im-
pending disasters.

The test, therefore, as reported by these
and all other chroniclers, may be regarded as
thorough and conclusive. Whatever might
be the ultimate aims of the men engaged in
conducting this movement, those aims must
be revealed when they had attained the full
measure of their power and could do as they
pleased. Wherefore these facts about the
"League's legislature," as it was called, being
admitted by hostile as well as friendly re-
corders, must be taken as verified, as follows:

It was the briefest regular session a legis-
lature had ever held in North Dakota and the
only one that adjourned short of the sixty
days allowed by the Constitution.

It was the most business-like, introducing
only one-fourth the usual number of bills,
and adding to the statute-books none that
was not well considered and of importance to
the state. Outside of the appropriation bills,
the total number enacted was only about 360,
which was the lowest record made by any
legislature in North Dakota history.

251

THE STORY OF THE NOXT ARTISAN LEAGUE

Personal bills, log-rolling bills, bills drawn
for the purpose of making political deals and
helping particular candidates, "strike bilk"
levied against corporations to squeeze money
out of them, all had disappeared.

It was one of the least expensive legislatures
that ever sat in North Dakota. At a time
when, because of the increase in the prices of
all supplies and of labor, an increase of ex-
penses might reasonably be expected, the cost
to the taxpayers of this legislature was fifty
thousand dollars less than the cost of the
legislature that preceded it.

The proceedings were grave, decorous,
business-like, swift. It was the second North
Dakota legislature that was not dominated
by lawyers. The only other instance of the
kind was the Fifteenth, the immediate prede-
cessor of this, and likewise composed mostly
of League members in one house and largely
of League members in the other. Many of
the members of this legislature had never
sat in a public body before. It was a good
test of the all but universal belief in this
country that only lawyers can make toler-
able delegates. These men, unused to law-
making, transacted business more readily,
quickly, reasonably, and directly than any
legislature of lawyers the state had ever
known. They spared speech, but pushed
business.

£52

THE FARMERS IX CONTROL

So much has been said in the Eastern press
about the autocratic or even despotic rule
believed to be exercised over the simple-
minded farmers composing the League that
some of the visiting reporters sought for this
manifestation as of unusual interest. They
found that the action of the League members
of the legislature on matters of importance
was decided by a caucus of all the members,
in which the pending bill was thoroughly dis-
cussed, and anybody was heard on it that
wanted to speak. This caucus, it had been
asserted, would be found to be secret, sinister,
and overawed by the dictatorship that was
believed to conduct the League's affairs.
They found that it was open, animated, and
occasionally vehement. One of the reporters,
after describing in detail two of these meet-
ings that he attended, wrote this conclusion:

If this was a fair sample of the League caucus — and
what I saw that evening and the next would lead one
to think it was — it appeared, taken by itself, to be a
pretty fair prairie replica of the old-fashioned New
England town meeting.

It was all of that. Every proposal was de-
bated up and down until all that had either
ideas or struggling emotions about it had re-
lieved their surcharged feelings. Then it was
put to a vote, and as the vote was recorded
so the League members of the legislature felt
themselves instructed to act. This was the

253

THE STORY OF THE XONPARTISAN LEAGUE

nearest approach to tyranny or coercion the
reporters seemed able to find.

What were the laws enacted by this legis-
lature of farmers, come at last, after so many
struggles, into the complete control of the state?

This question ought to be far more effec-
tive to show the real character and aims of
this movement than all possible assertions or
descriptions. If the movement was really
"anarchistic," on the one hand, or "absurdly
lunatic," on the other, the fact must be ap-
parent in the laws it passed when it had
attained to full power, and these laws we
should go on now to consider.

I will first, if I may, summarize for you the
grievances of which the farmer had complained
so many years, the unjust conditions that, in
his convinced opinion, made farming an un-
profitable business. These were:

l.—Thc High Cost of Capital

Extortionate money rates, impossible money
conditions, the consequent necessity of an in-
vestment beyond the producing power of the
country to sustain.

2. — Intolerable Market Conditions

A. An unscientific and preposterous sys-
tem of grain-grading, by which the buyer of

THE FARMERS IN CONTROL

the grain had always great advantage and the
producer never received the actual market
value of his produce.

B. False scales and fraudulent weighing,
by which the farmer was deprived of a part
of his just returns.

C. A system of toll-taking called dock-
age, by which the farmer was penalized ex-
cessively for foreign bodies in his grain, was de-
prived of ownership of these materials (often
of a considerable value), and finally was
obliged to pay the freightage to market on
these materials of which he had been unjustly
deprived.

D. Mixing-houses and their operations,
by which his grain, having been artificially
and unjustly assigned a low grade, to his
great injury, wras now restored to a high grade
for the sole benefit of the market manipulator.

E. The long line of needless middlemen
that sold the grain back and forth among
themselves, involving superfluous commis-
sions; the "spread" or artificial difference be-
tween high price and low price for the same
grade, by which these wash sales were facil-
itated and protected.

F. Excessive railroad rates, based not upon
service or distance or cost, but solely upon
what could be extracted from any commu-
nity to meet the exigencies of railroad over-
capitalization.

THE STORY OF THE NONPARTISAN LEAGUE

G. The use of the power generated by
these huge and illegitimate profits to control
the state government and gain more power
to make more profits to make more power.

II. The use of this power to suppress
efforts of the producers to better their condi-
tion by co-operative marketing.

7. The use of this power to nullify the will
of the people and prevent remedial measures
such as state hail insurance and the terminal
elevators, three times demanded by the voters
of the state.

3. — Taxation Abuses

The use of the control of the state so to
levy taxes that wealthy corporations, best
able to sustain the tax burden, got little of it,
and the farmer, struggling against heavy o<lds
and grinding poverty, must shoulder the
greater part of the levy.

We will now turn to the laws enacted by the
farmers' legislature, the Sixteenth, meeting in
January, 1919, and see what it actually did
to meet these difficulties and solve these
problems.

l.—Tlie High Cost of Capital

House Bill Xo. 18, approved February 25,
1919, establishing the Bank of North Dakota
to be operated by the state.

THE FARMERS IN CONTROL

This act authorizes the State Industrial
Commission, created by House Bill No. 17,
and approved February 25th, to locate, main-
tain, manage, and control the Bank of North
Dakota, for which capital is provided in the
amount of two million dollars, to be obtained
by the issue of bonds to that amount by the
state.

All state, county, township, municipal, and
school-district funds, and all funds of penal,
educational, and industrial institutions of the
state, are to be deposited in this bank. All
such deposits are deemed "available funds"
under the banking laws of the state and may
be lent under the proper restrictions. The
bank is authorized to do a regular banking
business, except that it cannot lend its money
or give credit to any individual, association,
or private corporation on any other security
than first mortgages on real estate in North
Dakota. But it may advance money to other
departments, institutions, utilities, industries,
or enterprises of the state.

The process of lending money on real estate
is guarded with much minute, and what
would seem to be sufficient, care, but the main
thing is that a means is provided whereby
the holder of agricultural land, if it is unen-
cumbered, can obtain money on that laud
quickly and at actual cost.

To secure this, the state treasurer is directed

257

THE STORY OF THE NONPARTISAN LEAGUE

in the act to prepare, and the governor and
the state treasurer are authorized to issue
bonds of the state amounting to not more than
ten million dollars to bear not more than (>
per cent, interest.

The bank is to receive applications for
first mortgage loans on farm lands, whether
improved or unimproved, and to lend money
upon them. As soon as the mortgages it has
accepted amount to one hundred thousand
dollars the Industrial Commission certifies
this fact to the state treasurer, and assigns
to him and deposits with him these mort-
gages. The governor, state auditor, and sec-
retary of state each inspect the mortgages,
after which the governor and the state treas-
urer issue to the Industrial Commission bonds
equal in amount to the sum of the mortgages.

These bonds the Industrial Commission
proceeds to sell, and the money derived from
this sale is immediately available to be lent
on more mortgages up to one hundred thou-
sand dollars, when the process is repeated. In
this way a revolving fund is provided up to
ten million dollars.

The bonds are certified, under the great seal
of the state, to be secured by real-estate first
mortgages deposited with the state treasurer.
Capital is thus provided without increasing
the state's total indebtedness. The interest
charge to the borrower on real estate is the

258

THE FARMERS IN CONTROL

interest rate that the bonds bear plus the
actual cost of administration, making a total
estimated at not more than 6^/2 per cent.,
when the bank shall be in full working order
(depending upon the condition of the securi-
ties market), as against 12 per cent., the legal
rate of interest under the old regime, and 16
to 20 per cent, actually charged.

One of the great advantages under this sys-
tem is that the loan is made quickly and easily.
When the application is received it is sent at
once to an agent of the state appraisement
machinery already in existence. He inspects
the property and returns the application,
properly verified and attested. The loan is
limited to one-half the appraised value.

Another advantage is that each applicant
can proceed separately and need not wait, as
he must under the Federal Farm Loan Act,
for the forming of an association of borrowers.
Another, and one of the greatest importance,
is that unimproved farm lands may be offered
as security, whereas under the federal law
there can be no lending except upon property
that has been improved.

Still another ancient though minor griev-
ance of the farmer was ended by the provision
authorizing loans upon warehouse receipts
issued by the Industrial Commission or by
any licensed warehouse in the state. This
takes from the private banker the power to

18 2o9

THE STORY OF THE NOXPARTISAN LEAGUE

coerce the farmer by withholding advances
upon grain shipped, a device by which, as we
have seen, the co-operative movement was
seriously hampered.

The Industrial Commission, created by
House Bill Xo. 17, consists of the governor,
the attorney -general, and the commissioner of
agriculture and labor. It is to manage and
operate all the utilities, industries, and enter-
prises of the state as well as the state bank.

&. — Market Conditions

A. As to Grain-grading Abuses, Senate
Bill Xo. 14, approved February 11, 1919,
creates the office of State Inspector of Grades,
Weights, and Measures, whose duties are to
establish uniform grades for grain, seeds, and
other agricultural products, to issue licenses
to warehouses and grain-buyers, to investi-
gate all matters connected with the market-
ing, grading, and weighing of grain and other
agricultural products; to inspect public ware-
houses and to make or change rules for the
weighing and grading of grain; to establish a
reasonable margin to be paid to producers of
gram by warehouses, elevators, and mills.

B. As to False Scales, this act puts all the
scales in North Dakota under the direct con-
trol of the state inspector, who is authorized
to employ assistants to test all the scales used
at elevators and warehouses.

1200

THE FARMERS IN CONTROL

C. As to Dockage, he is instructed to estab-
lish at once two kinds of dockage, that which
has value and that which has not, and to see
that the farmer is paid for that which has
value.

D. Mixing-House Evils. Senate Bill No.
20, approved February 25, 1919, declares the
purpose of the state of North Dakota to en-
gage in the business of manufacturing and
marketing farm products and to establish a
warehouse, elevator, and flour-mill system,
under the name of the North Dakota Mill
and Elevator Association to be operated by
the state. The work of constructing and
operating these mills and elevators is put into
the hands of the Industrial Commission, and
by a delicious touch of irony the money raised
by the special assessment tax levied in 1913
to build terminal elevators and side-tracked
by the legislature of that day is appropriated
for this purpose.

Senate Bill No. 75, approved February 25,
1919, completes this project by authorizing
the state to issue bonds, to be called the
"Mill and Elevator Series," bearing not more
than 6 per cent, interest, secured by first
mortgages upon the property used by the
North Dakota Mill and Elevator Association.
In this way the association is to be kept sup-
plied with the funds it needs, but the indebt-
edness of the state is not really increased,

2C1

THE STORY OF THE NONPAETISAN LEAGUE

since it will have security for all the bonds
issued.

E. The Needless Middlemen. Under the
foregoing acts the plan is for the state to erect
its own elevators and grind flour in its own
mills. So far as it shall be able to do this it
will eliminate the middlemen, save the useless
haulage of grain, save all the commissions
and wash sales, and abolish the "spread"
by abolishing the marketing outside of the
state of the grain raised within it.

F. Excessive Railroad Rates. House Bill
No. 48, approved February 19th, reduces the
number of classifications to which freight was
formerly subject, and then imposes on these
a new tariff for all railroad freight transpor-
tation within the state, based strictly upon
distance and service and effecting a reduction
on rates to be charged. All this is inside the
state limits. On interstate commerce, of
course, the North Dakota legislature could
do nothing.

G. The Misuse of the Power of the State
vanished, of course, when the old machine was
routed and the farmers took possession of the
government. There is extant some interest-
ing testimony by impartial witnesses as to the
change at Bismarck. It seems the capital of
North Dakota had been, like other state capi-
tals, a gathering-place for lobbyists in sup-
port of measures to promote private gain of

£6*

one kind or another, and it was the disap-
pearance of these and of the methods they had
naturally introduced that made the change
remarked by such witnesses.

H. The Release of Co-operative Societies
from the unfair and oppressive conditions
that formerly all but strangled them was to
a great extent effected by the Fifteenth legis-
lature, partly controlled by the League. The
acts for the furtherance of co-operation passed
by that legislature have been enthusiastically
called the best in the world. To these were
added by the Sixteenth legislature the laws
regulating the grain traffic and railroad rates,
all of which helped co-operation.

7. State Hail Insurance. Senate Bill No.
47, approved March 1, 1919, completes the
steps toward this needed reform begun by
the Fifteenth legislature. There is created in
the state insurance commissioner's office a
hail insurance department, under the com-
missioner's control. A flat tax of three cents
an acre is levied on all tillable land in the state
to provide the general working fund. On
October 10th of each year the commissioner
is to make an estimate of the amount of dam-
age likely to be caused by hail to the growing
crops the next year, with all the expenses of
the department, and then is to levy an in-
demnity tax on all actually cultivated and
crop land, except hay and meadow land, not

263

THE STORY OF THE NONPARTISAN LEAGUE

to exceed fifty cents an acre. Owners and
occupiers of land not wishing to have the
benefits of the law may withdraw their hold-
ings at any time up to the 15th of June.
Claims for indemnity for hail damage must be
sworn to and verified, after which they can
be paid by the commissioner up to the maxi-
mum allowance of seven dollars an acre.

3. — Taxation Abmcs

Senate Bill No. 43, approved February 24,
1919, abolishes an old abuse by adjusting the
assessment system. It divides taxable prop-
erty into two classes, one to be assessed at
100 per cent, of its true and full value and the
other at 50 per cent, thereof. In the first
class it places all railroads and other public
utilities with all the franchises and property
pertaining thereto; all land exclusive of the
structures and improvements upon it; all
bank stock; all flour-mills, elevators, ware-
houses, buildings, and improvements on rail-
road rights of way; all structures and improve-
ments on town and city lots used for business
purposes. In the second class, to be assessed
at 50 per cent, of its value, is placed all live
stock, agricultural and other machinery, see
residence structures on town and city lots, and
all other property not enumerated in the law.

THE FARMERS IN CONTROL

This brings within the reach of assessment
millions of dollars of property that has
always escaped heretofore.

Senate Bill No. 44, approved February 27,
1919, completes the adjustment by amending
the list of properties exempt from taxation.
This is now made to include all structures
and improvements on agricultural lands;
structures and improvements used as a place
of residence on town or city lots to the extent
of $1,000; household goods to $300; personal
belongings to $300; tools of a working-man
or mechanic to $300; tools and implements
of a farmer to $1,000, and all property used
for public purposes, including places of wor-
ship.

The most radical legislation of the session
was contained in Senate Bill No. 37 and
House Bill No. 84, one establishing a state
income tax and the other a tax on inheri-
tances.

Even these, however, had no feature or
principle not known and practised before in
such measures. The income tax law draws a
distinction between earned and unearned in-
comes, one being produced by labor, effort,
or service, and the other from investments.
For both classes there is an exemption of
$1,000. After that the tax on earned incomes
begins with % oi I per cent, on the first
$1,000 and increases with each $1,000 of

265

THE STORY OF THE NONPARTISAN LEAGUE

income to $20,000, when the tax is 5 per cent.
Thence it increases with each $10,000 of in-
come to $40,000, when the tax becomes 10
per cent, on that and all incomes greater.
The tax on unearned incomes begins with ^
of 1 per cent, on the first $1,000 and increases
to 10 per cent, on $30,000 and all beyond
that amount.

The inheritance tax begins with some
exemptions, which may be roughly stated to
be the equivalent of $15,000, after which the
tax rate is from lj/2 per cent, of the value of
the property up to 6 per cent, on property
of greater value than $500,000.

4. — Legislation Relating to Labor and the
General Welfare

What is regarded by experts as one of the
best measures of the session is a workmen's
compensation act, drawn after long considera-
tion of the laws on the subject now in force
in New Zealand, Germany, the states of Wash-
ington and Oregon, and other communities
that have experimented with such reforms.
It is called House Bill No. 56, approved
March 5, 1919. It carries this unusual
preamble:

The state of North Dakota, exercising herein its
police and sovereign powers, hereby declares that the

THE FARMERS IN CONTROL

prosperity of the state depends in a large measure
upon the well-being of its wage- workers, and, therefore,
for workmen injured in hazardous employments, and
their families and dependents, sure and certain relief
is hereby provided regardless of questions of fault and
to the exclusion of every other remedy.

The acts create the Workmen's Compensa-
tion Bureau and the Workmen's Compensa-
tion Fund. The Fund is obtained by a levy
upon employers, who are to be classified by
the Bureau according to the degree of danger
that attends each employment. The amount
of the tax the employer pays is proportioned
to this degree of danger.

When an employed person sustains any in-
jury in his or her employment the Bureau is
to furnish at once whatever medical or sur-
gical aid may be required. For the first
seven days thereafter the injured person is
entitled to no compensation unless the dis-
ability is prolonged beyond seven days, when
compensation begins from the date of the
accident. If the disability is total the Bu-
reau pays to the injured person a weekly
compensation equal to 66^ per cent, of his
wreekly wages, so long as that disability lasts.
If the disability is not total and not per-
manent, the compensation is arranged on the
basis of 662/^ per cent, of his weekly wages,
to be paid on the following scale:

267

THE STORY OF THE NOXPARTISAN LEAGUE

POT Percentage Wrek» of

of Di»ab\iity Payment

I 5.2

10 52

20 104

30 156

40 208

50 260

60 312

70 364

80 416

90 468

The weekly compensation for total dis-
ability is not to be more than $20 a week nor
less than $G, unless the injured person's wages
had been less than $6, in which case he is to
get the full amount of his wages. The Bu-
reau is also empowered to fix specific schedules
of compensation for specific injuries.

If death results from the injury within six
years, the Fund is to pay pensions to the de-
pendents. The widow, for instance, is to re-
ceive until her death or marriage 35 per cent,
of her husband's wages, and upon her mar-
riage a lump sum equal to 156 weeks' com-
pensation. If there are children the widow
is to receive an additional 10 per cent, for
each child up to GG^ per cent, of the hus-
band's wages, until the child dies, marries,
or reaches the age of eighteen years.

The Bureau has the right to inspect places
of employment and to enforce safety regula-
tions in them. It is also to try to restore all

THE FARMERS IN CONTROL

injured and crippled persons to industry, to
find work for them if possible, and to co-
operate for that purpose with the Federal
Board of Vocational Education.

House Bill No. 184 takes the "lives, health,
and morals of women and minor workers"
under the protection of the Workmen's Com-
pensation Bureau, which is authorized to fix
for such workers standard conditions and
hours of employment and a standard mini-
mum wage. House Bill No. 186 forbids the
employment of women in manufacturing and
similar enterprises for more than 8^/2 hours
in any one day nor more than 48 hours in
any week.

House Bill No. 57, approved February 14,
1919, forbids the issuing of an injunction or
restraining order in a labor dispute "unless
necessary to prevent irreparable injury to
property or to a property right of the party
making the application, for which injury
there is no adequate remedy at law." House
Bill No. 163 requires the use of the union
label on all the state printing. Senate Bill
No. 85 is the so-called Full Train Crew law
that has been enacted in Illinois and other
states.

One of the bills of this session that attracted
wide attention among sociologists was House
Bill No. 55, "An Act to Regulate the opera-
tion of all coal mines in the state of North

2G9

THE STORY OF THE NOXFARTISAN LEAGUE

Dakota." According to competent authority,
this is the best mining law ever enacted in
this or any other country, for it combines
with research the best features of all the
laws that have been elsewhere the product of
long experience. Every phase of the miner's
work to the minutest detail is covered and
protected. The place of chief coal mining
inspector is created with a Board of Exam-
iners, and all coal mining is placed under the
observation of these officers.

A law about which some misgivings were
felt was Senate Bill No. 19, "An Act Declar-
ing the purpose of the state of North Dakota
to engage in the enterprise of providing homes
for residents of this state and to that end to
establish a business system operated by the
state under the name of the Home Building
Association of North Dakota." This alone
of all the measures enacted at this session
seemed to be departing into dreamland and
Utopia. The state, it was felt, might prop-
erly enough try to protect the lives of coal
miners, but it had no call to furnish them
with dwelling-houses. It is to be observed,
however, that the bill was not so formidable as
it looked, and the first six months of its opera-
tion showed some excellent results in its favor.

The Home Building Association is under
the direction of the Industrial Commission.
It invites deposits on which it pays 5 per

270

THE FARMERS IN CONTROL

cent, interest, and it may also be assisted by
bond issues authorized by the state. Ten or
more depositors may constitute a Home Buy-
ers' League within the Association. When-
ever a member of a Home Buyers' League
shall have deposited 20 per cent, of the pur-
chase price of the home he wishes to buy or
build, the Association supplies the rest of the
required amount, and takes his mortgage for
the sum, repayment to be made by monthly
instalments so determined that they shall ex-
tinguish the principal within an agreed-upon
period — not less than ten years nor more
than twenty. The interest upon this mort-
gage is to be determined by the Industrial
Commission on the cost of the money plus the
cost of administration. The other members
of the Home Buyers' League are to be liable
to the amount of 15 per cent, of the purchase
price. The houses are not to cost more than
$5,000, except in the cases of f arm-houses,
where they may cost $10,000.

This plan was criticized as clumsy and in-
volved objections that may have been well
enough founded, for a special session of the
legislature, called in the fall of 1919, amended
it so as to facilitate the money supply. After
that it seemed to be in good order. Deposits
began to flow in, and Home Buyers' Leagues
to be organized. Wage-workers and minors
were especially sought as depositors.

271

THE STORY OF THE NONPARTISAX LEAGUE

Besides these there were laws passed auth-
orizing the cities of the state to employ city
managers; providing that the state should
insure its own buildings; prohibiting discrim-
ination by insurance companies in the issuing
or canceling of policies; and the much and
hotly debated bill unifying the state's educa-
tional system.

There was also a constitutional amendment
passed to the voters providing for the recall
of public officers. As this included judges as
well as state, county, and Congressional
officers, it aroused a furious attack.

This, with the appropriation bills and some
minor measures, was the record of the Six-
teenth General Assembly of North Dakota
under the control of the farmers. All of this
work was subjected to closest scrutiny by the
League's enemies, and much of it to the re-
view of the courts. Yet it was never shown
that its proposals were fundamentally anar-
chistic, bolshevistic, or revolutionary, and in
fact most of them were but similar to laws
parsed elsewhere. Even the Home Building
Association was the copy of a law in success-
ful operation in New Zealand.

But the campaign that began instantly
against these measures had its real objective
point in the terminal elevator and flour-mill
project. The bill to unify the state's educa-
tional system was selected as the nominal

THE FARMERS IN CONTROL

target, and made the most fuss about; but
this was no more than tactics. The terminal
elevator meant more than the rest because it
was the emblem and ensign of the old fight.
Three times its enemies had defeated it over
the expressed will of the people; if now the
people should win what they wanted it would
mean that the old machine was hopelessly
beaten. What was of still greater practical
importance, it would mean the establishment
of free markets for grain and the cutting out
of the system of commission forwarding,
which was the basis upon which the Chamber
of Commerce in Minneapolis was erected. It
struck, therefore, at the incomes and lively
expectations of a great many men, and most
seriously threatened the profits of banks, mills,
and railroad companies. In view of these facts
it is not strange that injunctions began at once
to obstruct the carrying out of nearly all the
measures that I have cited, but chiefly directed
against the elevator and flour-mill act.

Nevertheless, to a certain extent the new
program was soon seen to be undeniably a
great reform. Doctor Ladd was summoned
from his laboratory to be state inspector of
grades, weights, and measures, and installed
within the boundaries of the state a new sys-
tem of grain grades based upon laboratory
tests and milling value instead of weight and
appearance. His miniature mill and bake-

273

THE STORY OF THE NONPARTISAN LEAGUE

ovens at the college, wherein he ground
wheat and baked bread, came at last to an
official standing, for with these he subjected
cereal products to exact testings. He arranged
that any farmer that thought he had reason
to complain of the grading of his wheat could
send it free to the college, where it would
be tested scientifically and its real grade
determined.

It is true that the law operated only in
North Dakota; true that the bulk of the
North Dakota wheat would for some years
to come continue to flow to Minneapolis and
Duluth; true that in those markets the old
and unfair grades would continue to rule
without regard to Doctor Ladd and his test-
tubes. True, also, that most of this wheat
would be bought at country elevators and
most of the country elevators be owned in
"lines" by great and powerful concerns in
Minneapolis, outside the jurisdiction of the
farmers. But there was a provision in the
law, nevertheless, that made the most arro-
gant elevator man exceedingly careful as to
bis dealings \\ith the farmers that came to
him, and gave to Doctor Ladd a power over
them almost autocratic. As I have said, every
elevator and warehouse in the state must be
licensed, and now the state inspector had the
power to revoke any such license at any time
on proved charges of unfair grading or unfair

274

THE FARMERS IN CONTROL

dealing. It profited an elevator man nothing
to refer to the fact that his business was owned
in Minneapolis nor that the grain he was buy-
ing must be graded there. What was incum-
bent upon him was to adjust his grades to
those of Doctor Ladd and to do business with
circumspect probity lest he find his institution
closed.

The net result was an incalculable benefit
to the farmers of North Dakota, and before
long a boon to wheat-growers elsewhere. For
the first time in their experience they sold
their wheat at prices approximating its real
value, and if there were nothing else to be put
to the credit of the League but only this, I
should say deliberately, from my long ac-
quaintance with the farmer's troubles in the
Northwest, that this justified its existence and
all that it had cost.

Two other features of this legislature's work
came later under vehement attack. One
was the bill for the unifying of the state's
educational system under a consolidated con-
trol. The other looked to establish in every
county an official newspaper in which all
notices of foreclosure and other legal pro-
ceedings and all announcements about the
official business of the county were to be
printed.

The Educational Bill created a new body
called the Board of Administration, which

19 275

THE STORY OF THE NONPARTISAN LEAGUE

consolidated within itself the function of three
existing state commissions: the Board of
Education, the Board of Regents, and the
Board of Control. Five persons are to con-
stitute the new board, the State Superin-
tendent of Instruction, the Commissioner of
Agriculture and Labor, and three others to
be appointed by the governor. As only these
three appointees will be charges on this ac-
count against the tax levy it appears that the
act is in the interest of economy; and as
it reduces and simplifies machinery it may
be thought also in the interest of efficiency.
Ostensibly the chief attack was based upon
the charge that it was designed to put out of
office the State Superintendent of Schools.
This was an able and popular woman that
had been chosen in the primaries by a signifi-
cant majority. Opponents of the League said
that, as she could not be defeated in any other
way, the League leaders had hit upon this as
a device to that end, notwithstanding the
obvious fact that the law retained her in office,
interfered in no way with her functions, and
made her a member of the new board. Those
familiar with the fact that all these contests
have two aspects, the ostensible and the real,
or the exterior and the interior, may think
they have found the true origin of the savage
and continuous assault made on this law to
lie in its Section 6, relating to text-books.

276

THE FARMERS IN CONTROL

Far down in this section is an authorization
for a commission to consider the subject of
the text-books used in the state schools, their
unification, and the possibility of having them
printed by the state. It is sufficiently well
known that most of the text-books used in
the public schools of the United States are
supplied by a powerful and highly successful
trust, and I have been assured by many wit-
nesses that the evidences of the influence of
this trust on the campaign, subsequently man-
aged with much skill against this law, were
plain enough.

The official county newspaper was pro-
vided in two measures, Senate Bill No. 157
and Senate Bill No. 158. Their origin was
the practice of certain loan agents of printing
foreclosures in newspapers, small, obscure, and
so far away from the address of the unfortu-
nate mortgagor that he had small chance of
ever seeing the notice. If he did not see it
he would take no steps to protect himself
within the period allowed for redemption,
with the result that his next experience would
be a dispossess proceeding against which he
had no appeal. It was in every way in the
interest of honesty, fairness, and the reason-
able protection of the mortgagor that the
newspaper in which these foreclosure notices
might always be found should be designated
and known to all.

277

THE STORY OF THE NONPARTISAN LEAGUE

Against this improvement the League's op-
ponents brought the charge that the official
newspaper was to be selected in each county
by the state administration, an arrangement
that would give to the administration in effect
a subsidized press. Newspapers and news
agencies said that this was the fact, and said
it so widely and persistently that the whole
nation seemed to believe it. Yet the truth
wras very different, as any inquirer can easily
discover. Of the acts embodying this reform,
Senate Bill No. 157 provided that a State
Printing Commission should for the time being
select the official newspaper in each county;
or if the State Commission failed to make this
selection it was to be made by the county
authorities; but Senate Bill No. 158 provided
that at the next general election and at each
election thereafter the voters in each county
should by ballot make their own choice of the
official newspaper. By referring to and de-
scribing Senate Bill No. 157, and omitting to
mention Senate Bill No. 158, opponents of
the League were in an excellent position to
assert that what was intended was a subsidized
press, and the result upon the opinion of the
country may be termed a potent illustration
of the power of propaganda — also a new view
of its methods.1 Instead of establishing a

1 Formerly there were three official newspapers in each county,
and these printed all official matter, such as tax assessments, county

278

THE FARMERS IN CONTROL

subsidized press, the bill went beyond any pre-
vious legislation to make the press untram-
meled and democratic.

treasurer's and county auditor's reports, county commissioners' pro-
ceedings, and the like. This triplication of official publications was
a useless expense running into many hundred thousand dollars a
year. The League bills abolished two-thirds of this expense and
put into the power of the voters to say what should be the disposition
of the remaining one-third.

CHAPTER XVI

SCHISMS AND INJUNCTIONS

THERE never was any country in this
world having a free and popular form
of government where a movement for social
or political reform did not at some tune
trip or stumble over the personal ambitions
or the jealousies of its supporters. This is a
condition inseparable from democracy; the
temptation is beyond the resistance of ordi-
nary human nature. The state government
that the complete triumph of the League had
swept into office was hardly assured before
a cleavage began to appear.

I have spoken of the League's blunders,
which we must view in all their aspects if we
are to understand this remarkable movement.
One of these blunders, more than once re-
peated, has been a too great and too careless
confidence in the choosing of its nominees.
On any reflection it will be clear enough that,
however honest, able, and talented a man
might be, he could not be effective for the
purposes of this organization unless he had in
his temper also enough of the apostolic spirit

SCHISMS AND INJUNCTIONS

that he should be willing at all times to sub-
ordinate his own interests and his own am-
bitions to the good of the cause. This was
required absolutely of him, in any conflict of
this kind, that laying aside his vanities and
his selfishness he should be a genuine Soldier
of the Common Good. Soon after the election
of 1918 two of the League's successful candi-
dates, the secretary of state and the attorney-
general, elected in 1916 and re-elected, broke
away from the League program and launched
an opposition. The state auditor followed
them. Naturally the appearance of this re-
volt was hailed fervently by the elements that
from the beginning had fought the League's
every proposal and maneuver. There was
probably more joy in the old political machine
and the Minneapolis Chamber of Commerce
over these manifestations than over anything
that had happened since Townley led his
cohorts into the open. The delight of these
Interests, it may be believed, was much ac-
centuated when the attorney -general objected
vigorously to the bill creating the Industrial
Commission upon which pivoted squarely the
bills providing for the state-owned elevators
and flour-mills and the state bank. For these,
of course, were the measures most hateful to
all the influences that for so many years had
dominated the state. As North Dakota had
a fairly mobile and workable referendum law,

281

THE STORY OF THE NONPARTISAN LEAGUE

the opponents of the League program, old and
new, easily secured a referendum election, fixed
to take place on June 26, 1919, at which seven
of the representative measures passed by the
Sixteenth General Assembly should be put to
the test of a popular vote.

In the judgment of all observers the League
was now confronted with the crisis of its his-
tory. The attorney-general, the secretary of
state, and the state auditor undeniably gen-
eraled a considerable following; how large no
man could tell. The incessant assaults upon
Townley and the League management, the
charges of autocracy and bossism, the fabri-
cated stories about disloyalty, the adroit in-
sinuations against character, were certain to
have effect. The opposition would naturally
amalgamate with the entire resources of the
reactionaries all the discontent among the
radicals; and being supplied with unlimited
means, having the vast preponderance of
press influence, having, too, far greater ad-
vantages of political experience and skill, it
was felt that the League was in imminent
danger. If it should be beaten in the refer-
endum it would vanish as a possible factor
in the political affairs, not only of North
Dakota, but of every other state into which
it had entered; for to be repudiated at that
critical time by the community in which it
had started would be its death-blow.

SCHISMS AND INJUNCTIONS

The campaign preceding this referendum is
likely long to be remembered as the most
strenuous in the history of the state. The
old political machine, rallying all its latent
forces, encouraged by the active or secret
sympathy of all the great financial, commer-
cial, and transportation Interests of the coun-
try, fought with great skill and desperate
energy. Speakers were imported on both
sides and the state rang with charges and
counter-charges, for as is inevitable, however
unfortunate, in these contests, the personal
element seemed at times to outweigh the
welfare of the public. Without going too
deeply into the reasons for this, it is only fair
to recall the unusual nature of the legislation
that was the main question involved and the
variety and truly great power of the invest-
ments some of this legislation threatened.
Thus:

1. The Bank of North Dakota threatened
the huge profits of the money-lenders, in
which the entire banking system of the
Northwest, including the overshadowing finan-
cial institutions of Minneapolis and St. Paul,
had shared for a full generation. These finan-
cial institutions were directly connected with
the powerful banks, insurance and trust com-
panies of Wall Street, whose influence in
national affairs has been solemnly attested
by a committee of Congress.

THE STORY OF THE NONPARTISAN LEAGUE

2. The railroad rate bill directly menaced
the most powerful railroad companies of the
United States; companies accustomed for
many years to unquestioned political domina-
tion in the Northwest, companies also directly
linked with the great packing-house combi-
nations, the greatest banks in Chicago and
New York, and the interests that were once
called the final arbiters of national destiny.

3. The proposal that the state should own
its elevators struck directly at the great and
profitable business of handling grain, erected
through so many years around the Minne-
apolis Chamber of Commerce. This naturally
involved an assault upon the profits and
prosperity of the Minneapolis banks, linked
as before said to the greatest banks in the
country; linked also to the great and not
always apparent speculative Interests in the
grain business that centered in the Chicago
Board of Trade, involved the Armours and
other packing Interests, and was linked once
more to railroads, banks, and insurance
companies.

4. The proposal that the state should build
and operate flour-mills was an ominous blow
at the great flour-milling Interests of Minne-
apolis, the greatest of their kind, whose mills
rolled forth a daily total of eighty thousand
barrels of flour, and fed an appreciable part
of the world.

284

SCHISMS AND INJUNCTIONS

5. The Hail Insurance Act menaced the
business and profits of the insurance com-
panies linked with the banks that were linked
with the railroads and linked with the con-
trolling groups of Wall Street.

6. The suggestion that the state might
print and furnish its own school text-books
was a menace to the business and profits of
the school-book trust, linked as the other In-
terests and in the same way to the controlling
groups.

7. The laws instituting the State Income
Tax, State Inheritance Tax, Work-men's
Compensation for Injuries, the strict inspec-
tion of mines, although not without prece-
dent, undoubtedly aroused each its own ele-
ment of opposition that was drawn now to
the general assault. For it was felt in all of
these menaced quarters that if the League's
innovations should be sustained in North
Dakota they would be adopted within a short
time in other states, and no man might foresee
how far the reform might go nor what pro-
found changes it might achieve.

Two incidents will illustrate the fierceness
of the contest and the unfairness with which
it was waged. In the session of the Sixteenth
or Farmers' General Assembly a member of
the House introduced a bill, regarded by all
his conferees as a stupid and silly joke, declar-
ing that all returned soldiers from the war

285

THE STORY OF THE NONPARTISAN LEAGUE

should marry" and providing pretended penal-
ties for women that should refuse offers of
marriage from such suitors. No attention
was paid to this apparent outburst of bovine
humor, and the incident was quickly for-
gotten. In the campaign it was dragged up,
twisted, incredible as this may seem, into a
bill to nationalize women, and the whole
country was informed through the press
agencies that the League had sanctioned and
introduced a measure to make women state
property. The man that designed this
measure appeared in the campaign as a
strenuous opponent of the League, a fact
that spread some doubt as to the merely
humorous purport of his effort. Anyway,
the newspapers, orators, and others fighting
the League always omitted to say anything
about a humorous intent. According to them
the League had plunged to the depths of
moral degradation, for here was proof that it
was imitating what they had been led to
believe was a practice of the Bolshevists.

The other incident was just as extravagant
and still more hurtful to the League's cam-
paign. From the beginning its opponents had
said that it stood for the state ownership of
all farm lands, and had tried unsuccessfully
to read this purpose into its declarations about
taxation and the like. Some one now pre-
pared and printed a fictitious dispossess notice

286

SCHISMS AND INJUNCTIONS

setting forth that the state government had
decided to take possession of all such lands,
and accordingly the owner or tenant of "the
following premises to wit" (a blank being left
here for a description of the property) was
notified to vacate such property on or before
a given date, or failing to do so the state
would forcibly eject him.

These blanks, filled in with the names of
owners or tenants, adorned with a false seal,
and apparently attested, were served hi large
numbers upon foreign-born and ill-informed
farmers in remote regions of the state, and
made a great impression, the more effective
because this device was held back until within
a few days of the election, so that there should
be no time to refute it.

The referendum involved seven measures
passed by the General Assembly. It wTas as-
serted by the League champions that these
seven were so chosen as to avoid a direct issue
on fundamental principles of the League plat-
form, but to increase at the same time the
likelihood of a League defeat that could be
asserted as an inferential overthrow of the
League's whole plan of reform. What truth
there may be in this I am unable to say. I
may not deny, however, that the first two
measures in the referendum were the least
liked of all the work of the legislature and
were not League program bills. These were

287

THE STORY OF THE NONPARTISAN LEAGUE

the law creating a State Printing Commission,
Senate Bill No. 157, and the law creating the
Board of Administration, Senate Bill No. 134,
by which, as I have previously told, a popular
and capable woman was supposed to be legis-
lated out of office.

The other measures submitted to the refer-
endum were, third, a bill creating a state tax
commissioner, in which no one, so far as I
could learn, seemed much interested; fourth,
a bill creating a commissioner of immigration,
which was in much the same category; fifth,
the industrial commission bill, on which, as
I have explained, hung the terminal elevator
and the state flour-mills; sixth, a bill re-
districting the state for judicial purposes;
seventh, the bill creating the Bank of North
Dakota.

It will be seen that of these only the fifth
and seventh could be regarded as vital to the
League program or even connected therewith,
although it is no doubt true, as the League
newspapers asserted, that an adverse vote on
any of the proposals would have been taken
as the repudiation of that program by the
people of the state.

The campaign closed with confident asser-
tions by the opposition and many predictions
from independent sources that the League
was beaten. The count of votes showed the
following results:

288

SCHISMS AND INJUNCTIONS

1. On the State Publication and Printing Commission:

For the measure 59,364

Against 52,450

Majority for 6,914

2. On the State Board of Administration:

For the measure 59,749

Against 51,894

Majority for 7,855

3. On the State Tax Commissioner:

For the measure 60,412

Against 50,316

Majority for 1 0,006

4. On the Commissioner of Immigration Bill:

For the measure 59,421

Against 52,156

Majority for 7,265

5. On the Industrial Commission Bill:

For the measure 61,188

Against 50,271

Majority for 10,917

6. On the Judicial District Bill:"

For the measure 60,343

Against 49,925

Majority for 10,418

7. On the Bank of North Dakota Bill:

For the measure 61,495

Against 48,239

Majority for 13,256

289

THE STORY OF THE NONPARTISAN LEAGUE

It will be seen from this that the largest
majorities were recorded for the two bills that
were of the League program, and the smallest
for the printing commission bill, which had
never been mentioned in that program.

At the general election of 1918 there had
been submitted to the voters ten amendments
to the Constitution, and by comparing the
votes they received some notion may be
formed of the effect of the split in the League
and the active and organized campaign of its
opponents. I have also found interest in
these records as showing the varying views
of the people on different phases of reform,
and likewise the activities and prevision of
the League leaders, for most of these amend-
ments came into use almost at once to their
great assistance. This is the list:

1. Making changes in the voting privileges of co-opera-
tive corporations:

In favor of the amendment 40, 392

Opposed 32,0,53

Majority in favor 17,339

2. To make the votes of four supreme court judges
necessary to declare any law unconstitutional:

In favor of the amendment 5-2,078

Opposed 28,846

Majority in favor 23,832

SCHISMS AND INJUNCTIONS

3. To add a section providing for state hail insurance:

In favor of the amendment 52,475

Opposed 30,257

Majority in favor 22,218

4. Enlarging the initiative and referendum:

In favor of the amendment 47,447

Opposed 32,598

Majority in favor 14,840

5. To grant to the legislature power to pass emergency

measures :

In favor of the amendment 46,121

Opposed 32,507

Majority in favor 13,014

6. To simplify the amending of the Constitution by

making but one indorsement by the legisla-
ture necessary:

In favor of the amendment 46,329

Opposed 33,572

Majority in favor 12,757

7. To make taxes uniform upon the same class of

properly :

In favor of the amendment 46,833

Opposed 33,921

Majority in favor. ...... 12,912

8. To authorize an acreage tax for hail insurance:

In favor of the amendment 49,878

Opposed 31.586

Majority in favor 18,292

20 sJ9l

THE STORY OF THE NOXPARTISAN LEAGUE

9. To authorize the issuing of real-estate bonds by the
state government:

In favor of the amendment 40,275

Opposed 84,235

Majority in favor 12,040

10. To authorize state, county, or municipality to en-
gage in any business not prohibited by Arti-
cle 20 of the Constitution:

In favor of the amendment 40,830

Opposed 32,574

Majority in favor 14,256

Students of our ways political will probably
note with interest that the referendum of 1919
was the fourth time the people of North
Dakota had voted in favor of a terminal ele-
vator, and that seven years had now elapsed
since the first time they had given their com-
mand on this subject, and the elevator of
their desire was still no more than a mental
linage to them.

\Yith the decisive vote of the referendum
the last hope vanished of defeating at the
polls the changes that the League had pur-
posed. The opponents of these measures had
no\v no recourse except through the courts.
They had already begun procedures to enjoin
the state government from carrying out some
of the measures enacted by the Sixteenth As-
sembly and they no\v assiduously pushed

SCHISMS AND INJUNCTIONS

these and added others until the League found
itself confronting the following formidable ar-
ray of legal entanglements:

1. Against the Workmen's Compensation
Act. The state treasurer was notified to re-
fuse payment of the warrants of the Bureau
on the ground that these warrants should
first go through the hands of the state auditor,
who, being hostile, would then be able to hold
up every item for investigation with a result-
ing delay that would paralyze the operation
of the act. The Bureau was obliged to begin
mandamus proceedings to compel the state
treasurer to pay the warrants as provided by
law, but while the fight over these proceed-
ings went on from court to court, the opera-
tion of the law was practically suspended.

Meantime mandamus proceedings had been
begun on the other side by the state auditor,
the attorney-general acting as his counsel, to
compel the Workmen's Compensation Bureau
to allow the state auditor and private account-
ants of his choosing to examine the Bureau's
books, although it had been in existence only
two months. The plaintiffs in this action
went across the Missouri River to Mandan,
made their applications to an obscure district
court, and got an order compelling the Bureau
to appear in Mandan and show cause within
fewer than twenty -four hours. Attorney
William Lemke of Fargo, who had appeared

£93

THE STORY OF THE XOXPARTISAX LEAGUE

on more than one occasion as the resourceful
fairy godmother of the League, now sprang
into the breach and got an order from a supe-
rior court ordering the judge at Mandan to
show cause why he should not be prohibited
from hearing the first action on the ground
that he was out of the district. When this
application came up the action was made
broad enough to cover all phases of the issue,
resulting naturally in an appeal and further
delay. Meantime the Bureau was unable to
pay any claims under the act, as the state
auditor refused to pass them, and to a great
extent consequently this beneficent law was
nullified.

2. Injunction proceedings. An action of
which the origin was concealed, but seems
to have been surmised by the League press,
was begun against the constitutionality of
the Work-men's Compensation Act on the
ground of a defect in the title; also that the
act delegates legislative powers to the Com-
pensation Bureau because it leaves some rates
of compensation in some certain conditions
to be fixed by the Bureau. At the time of
writing this action is still winding its slow
length along.

,S. Against educational consolidation. This
was an action brought by the state superin-
tendent of education through the attorney-
general to restrain the Board of Administra-

SCHISMS AND INJUNCTIONS

tion from performing its functions under the
act that created it. By this act the board was
authorized to establish a subsidiary Board of
Commissioners of Education, which was to re-
vise the courses of instruction for the several
classes in the public schools. The action of
the superintendent was directed especially
against this subsidiary commission, notwith-
standing the fact that she was not only a
member, but its president, while the other
members were noted educators and one a fore-
most and selected representative of the county
schools.

4. Against any change. An action was
brought in the name of forty-two taxpayers
against the entire industrial program of the
League, terminal elevator, flour-mills, bank,
and the rest, on the ground that all was un-
constitutional, being private business and not
public. Very distinguished counsel appeared
in support of this motion. There was the firm
of Young, Watson & Connay, attorneys for
the Northern Pacific and Chicago, Milwaukee
& St. Paul Railroads; Tracy Bangs of Grand
Forks, attorney for the Northwestern Tele-
phone and Western Union Telegraph Com-
panies; and. the firm of Murphy & Toner,
attorneys for the Great Northern Railroad
Company. This action wras brought in the
United States District Court, where, upon
being argued, the forty-two taxpayers were

THE STORY OF THE NOXPAHTISAN LEAGUE

rather disconcerted to hear Judge Amidon
negative their petition on these grounds:

First, that they had no jurisdiction because none of
the1 taxpayers had been injured by these laws; and,
second, that even if they had jurisdiction they had no
case on its merits.

Thereupon the case was appealed by the
forty-two (or their counsel) to the Supreme
Court at Washington, thus insuring more
argument, more hearings, and indefinite de-
lay. For by such difficult and tortuous ways
do we proceed to determine whether the people
of North Dakota may properly have the alter-
ations in their own business affairs for which
they have four times voted.

5. State court proceedings. A similar suit
brought in the state courts to determine the
constitutionality of the acts relating to the
Industrial Commission, the Bank of North
Dakota, the bank bonds, the real-estate bonds,
the North Dakota Mill and Elevator Associa-
tion, the mill and elevator bonds, the Home
Building Association, and the Soldiers' Com-
pensation Act, was decided by the state su-
preme court in the League's favor.

In spite of the obstacles of so many court
actions the state administration proceeded,
so far as it was able, to carry out the will of
the majority of the people. It began, as soon
as the referendum returns were announced,
to draw its plans for three great flour-mills

SCHISMS AND INJUNCTIONS

and three terminal elevators to be built in
different parts of the state. A year will be
required to erect and equip these, at the end
of which time, or eight years after they first
voted it, the people may see their will carried
out, provided no more courts break in with
restraining injunctions.

Meantime the state had secured one mill
ready-made, and began in the summer of 1919
to operate it. This was at the town of Drake,
where the people were so much interested in
the plan that they sold in their own com-
munity $25,500 of bonds to buy the property
for the state, although the price was only
$20,000. When the state took possession, it
began to buy wheat solely on the basis of
milling value and without regard to Minne-
apolis grades, with the result that farmers
hauled wheat as much as forty miles to get
the advantage of the better prices. Yet if
what seems trustworthy testimony from the
manager is to be accepted, the experiment
quickly showed that even at these prices flour
can be, and is, produced at much lower figures
than the Minneapolis mills charge. The
capacity of the Drake mill is 125 barrels a
day, and it has been kept running to its fullest
output since the state took it. The three
mills the state is to erect will have a capacity
of from 2,500 to 3,000 barrels a day, each;
and on the basis of the success of the Drake

297

THE STORY OF TIIE NONPARTISAN LEAGUE

experiment high hopes are entertained about
these ventures. Their practical results are
still to be seen. Those in command of them
seem to be fairly well informed as to the diffi-
culties they are likely to confront, for it is
said that to forestall the chance of an organ-
ized boycott against them in the Eastern
markets they have arranged to create their
own selling agencies.

At all these mills the milling values of wheat
will be the only grades recognized.

If the present plans are carried out, the new
system will have another inestimable advan-
tage in the fact that the farmer will not be
obliged to sell his wheat, as at present, when
the price is the lowest. The state elevators
will take his wheat, store it, and issue him
a bill upon it, subject to the necessary insur-
ance and other charges and margins, and the
state bank will let him have money on this
bill, which will be to him the equivalent of
cash, and yet allow him to take advantage of
a subsequent rise in the market.

This was the outlook, nine months after the
League had received at the referendum of
1919 its final mandate from the people to go
ahead with its reforms.

State hail insurance was in full and suc-
c-cssful operation. For the first season about
eight million acres were insured, and on these
the fanners saved $3,150,000 compared with

SCHISMS AND INJUNCTIONS

the rates they would have paid to the insur-
ance companies.

The Bank of North Dakota was in full
operation and had achieved an apparently
phenomenal success. It was opened for busi-
ness on July 28th, and on November loth,
less than four months later, its statement
showed it to have $17,512,992 of resources.
In one period of thirty days the bank had
recorded clearings amounting to $38,242,634,
represented in 177,340 items, and its average
daily clearings were $1,278,562. "No similar
results," observed F. W. Cathro, the director-
general, "have been so satisfactorily attained,
or even approached, in the banking history of
the United States."

In the way of farm loans, for which the
bank was primarily created, there had been
received 1,575 applications, amounting to
$6,588,940. Six regular and four special ap-
praisers were kept in the field to examine
these applications, and had reported to the
bank 504 appraisals. Of these 232 applica-
tions had been approved and loans made on
them to the amount of $927,200, while the
papers were out for the acceptance of 83 addi-
tional loans totaling $363,400, and for signa-
ture, for record, or for the clearing of the title
in 149 more, total $563,800. This makes a
total of farm loans completed, or practically
completed in three months and a half, of

299

THE STORY OF THE NONPARTISAN LEAGUE

$1,854,400, at lower rates of interest than
were ever known in North Dakota. Accord-
ing to a Bulletin of the Department of Agri-
culture, the average rate in the state was
8 7-10 per cent. The Bank of North Dakota
had in three months and a half cut under
that by 2}/2 per cent. And this at a cost for
appraisal of $2,896 on loans totaling more
than $1,800,000. The satisfaction of the
director-general would seem to be justified.
The bank in three and a half months had
saved the farmers $45,000 in interest.

The litigation designed to eliminate the
bank interfered with the development and
operations that had been planned for it, but
while the decisions in the suits were being
waited for the bank continued to grow. By
February 15, 1920, seven months after its
launching, its resources were $19,957,739, and
its farm loans $1,382,094, with about $2,000,-
000 of additional farm loans pending.

CHAPTER XVII

FIGHTING IN THE LAST TRENCH

A TEVERTHELESS the story of this organi-
1>| zation is one long tale of desperate
struggles and narrow escapes, as if it were a
band of outlaws menacing the safety of the
community. From that day in 1915 when it
appeared as a living force, it has not known
a moment when its existence was not in peril.
The League orators and writers said acidly
that if it had gone in to play the gambling
game instead of trying to upset it, the same
members pictured as demi-devils would have
been patted on the back and hailed as the
best fellows that ever lived.

They said they could not even have the
truth about themselves or their movement,
nor about anything they said or did, told in
the public press. No matter what action of
the League was related, it was never men-
tioned truthfully, but always distorted that
it might be covered with denunciation and
ridicule. They said that if any person con-
nected with the League was interviewed for

301

THE STORY OF THE NONPARTISAN LEAGUE

publication the interview was inrariably first
distorted and then adorned with fabrications;
if any meeting of the League was reported,
the report was always untruthful and to the
League's discredit. To get the League's cause
fairly before the public it wras, these officers
said, driven to establish its own press.

After the founding of the League at Fargo
it bought or started daily and weekly journals
in scattered communities. In at least one of
these cases, that of The Courier-News of
Fargo, the League's purchase was assailed in
court and must be fought for with counsel
and arguments, while in other instances
attempts were made to keep the League
newspapers from obtaining a news service.

At the lime that the flood of injunctions, of
which I have just cited instances, descended
upon it the League was exposed to a new
and still more threatening assault. It will
be remembered that its simple but effective
plan of operation was to capture the primary
elections. In this it was favored by the fact
that the Northwestern States generally had
broad and liberal primary systems, secured
ut'ler years of agitation by progressive men
sick and weary of (he scandals of the old
convention regime. Originally all these states
had been cursed wiih political bossism, of
which the chief strength lay in the conven-
tion, delegates to which were easily chosen

IN THE LAST TRENCH

and more easily controlled by the worst in-
fluences in American politics. But the pri-
mary reforms put within the power of the
people to choose in every party the candi-
dates for the succeeding election, and nothing
else in our political history had been so
salutary. The League, working through this
system, tried to nominate the Republican
candidate in Republican communities and the
Democratic candidate in Democratic com-
munities, having no partisan interest, but
seeking merely to get into office candidates
that would uphold the farmers' cause. The
primarv, therefore, came near to being its
life.

Early in 1916 it entered Montana, where
by the end of 1918 it had made such prog-
ress expert politicians foresaw that at the
next general election it would sweep the state.
Montana, because of the presence of large
mining and other corporations, has always
been unfortunate in its political condition. I
am speaking — as all that know the state will
admit — with extreme delicacy. What really
went on may be guessed from the fact that a
Montana Senator of the United States re-
signed in the face of most damaging charges
of bribery, and few state elections have been
without their scandals. Naturally, therefore,
the old political machine in Montana was
growing audacious, autocratic, corrupt, and

THE STORY OF THE NOXPARTISAN LEAGUE

the vicious handmaid of the corporations
whose profits made political control a mat-
ter of good business. All of these Interests
and institutions saw with alarm the rapid
advance of the League. On both sides it
threatened their partnership.

This being the case, the old political machine
had no difficulty in slipping through the legis-
lature of January, 1919, a bill that practically
abolished the primary and returned to the
old convention plan for the nominating of
state candidates.

Montana has a fairly good referendum law
under which, by petition, an ordinary act of
the legislature can be referred to the people,
pending whose decision it becomes inoperative.

The League managers, taken off their guard
by the politicians' adroit move, made haste
to get the requisite number of signers to a
petition to submit this particular law to the
voters at the next general election.

But the next general election would not
occur until November, 1920, and meantime
the League would be gaining daily in strength
with always a greater likelihood that in the
referendum it would shatter the new law under
an overwhelming majority.

In this emergency the machine achieved a
trick of transcendent cunning. The state, in
the summer of 1910, was afflicted with a
drought likely to be long remembered for its

IN THE LAST TRENCH

severity and disasters. The political machin-
ists took advantage of this opportunity to
call a special session of the legislature, osten-
sibly to pass measures of relief for the farmers
in the drought-stricken area. When the legis-
lature assembled it seemed utterly to forget
the poor drought sufferers, for it passed not
a measure for them nor about them, but only
enacted another law knocking out the primary.
And this law, under a peculiar feature of the
Montana system, was rendered immune against
the referendum by declaring in the last para-
graph that it was an emergency measure,
being needed at once for the security and
welfare of the state.

As the case stood, the League was defeated,
and the primary for the time being abolished.
But the League proceeded to attack with
referendum petitions the act of the special
session that declared the primary repeal an
"emergency" measure. The petitions were
filed. Meantime the supreme court declared
the "emergency" clause invalid, and the re-
sult was that the referendum on the repeal of
the law must be held in November, 1920, and
until then the repeal was inoperative.

In Idaho, where the League had been mak-
ing great inroads, the reactionaries succeeded
in abolishing the primary.

In Nebraska the plan seems to have been

to wreck the primary without abolishing it,

"305

THE STORY OF THE NONPARTISAN LEAGUE

and the discriminating observer cannot but
admire the manner in which this was at-
tempted. The reforming element in the state
had long felt that the primary law did not
go far enough. It provided that candidates
should be chosen by primary election, but
it allowed conventions, chosen in the old
manner, to prepare the party platforms and
select the party committee. The result was
(said the reformers) that candidates of pro-
gressive views found themselves standing on
platforms that contradicted their professions,
while their campaigns were managed by com-
mittees unfriendly to them and often trying
to compass their defeat. The legislature,
therefore, passed a law extending the primary
principle to party conventions and party
committees, but the same measure concealed
a provision that thereafter all candidates for
state offices below that of governor were to
be chosen by conventions instead of by pri-
maries. This put the legislature back under
the control of the machine, which was the
thing most desired by the corporations and
the reactionary influences, and most to be
feared by the League.

"\\ hen the reformers awoke to the trick that
had been played upon them, they called a
conference at Omaha to consider the grave
situation thus created. Republicans, Demo-
crats, Xonpartisan Leaguers, and others, at-

IN THE LAST TRENCH

tended. It was the opinion of the most ex-
perienced politicians present that nothing
could be done to prevent the operation of the
act, as there was hardly time to secure a
referendum petition, and the inclusion in the
law of a reform long demanded had hopelessly
confused the issue. The chief representative
of the League at this conference, Mr. Soren-
son of Lincoln, announced that he would not
be bound by any decision to accept the law,
and went forth at once with a petition for a
referendum. In spite of the fact that the
month was the farmers' busiest season, he
secured in the first week the signatures of
eight hundred farmers, and within the time
limits had twenty-six thousand names, enough
to force the submission of the law at the next
general election, to be in November, 1920.

Meantime, the new primary law could not
work, and the advance of the League was not
stopped.

In Minnesota a special session of the legis-
lature was called for September 9, 191 3, to
consider nine subjects, the seventh of which
was announced to be the revision of the
primary laws. It seemed to be no secret in
the state that in this case "revision" meant
repeal. The legislature met and considered
the nine subjects, but refused to amend or
repeal the primary law, and in that state the
League was saved.

L'l 307

THE STORY OF THE NONPARTISAN LEAGUE

The real reason for the haste to attack the
primary in Minnesota was said to be the fact
that organized labor had but lately formed a
nonpartisan league of its own, intending to
act with the farmers, and that the two were
certain to carry the state in 1920. The jus-
tice of tli is must be determined by the reader.
It is true enough that the labor nonpartisan
league had been formed and had been indorsed
bv the state labor convention.

CHAPTER XVIII

THE FAMOUS BANK CASE AT FARGO

THE great difficulty about telling such a
story is that the mere marshaling of the
incidents as they happened is in itself enough
to create the impression that the narrator is
an advocate and not a historian. This is not
my fault; it is a result of the adroit nature
and tireless persistence of the attacks on the
League, which must always be told as they
happened; and the next in this series came
(through an authority far beyond me) to be
denounced with more bitterness than any
other tactics thus far brought to bear on the
League organization.

The new peril developed without warning
in September, 1919, and for sufficient reasons
gave the League leaders great concern. As
the story is peculiar and rather complicated,
I had better tell it from the beginning.

As I explained in a former chapter, the
practice of the League from the first day had
been to accept in payment of dues what are
called postdated checks. That is to say, a

309

TILE STORY OF THE NONPARTISAN LEAGUE

member joining, or paying his dues, in June,
when lie had no wheat, would give a check
dated in October, when his wheat should be
sold.

This was merely a result of the abnormal
marketing conditions \ve have been discuss-
ing. A farmer was compelled by the existing
methods to sell his wheat when the influences
controlling the market desired to buy it. He
received his pay, in other words, once a year,
and, as always happens under such circum-
stances, he lived a part of the succeeding year
on credit. The thing had been fastened upon
the state by years of practice, so that post-
dated checks were no novelty when the League
came into being. The North Dakota banks
took, without the least hesitation, such checks
from the League, which deposited them freely,
and it is said that in four years no bank had
lost a dollar by them.

The law of North Dakota constitutes the
governor, the attorney-general, and the secre-
tary of state as the state banking board. It
will be noticed that this meant now an anti-
Leauiie majority, the attorney-general and
secretary of state having gone over to the
League's opponents. The law also provides
for state examiners of banks, upon whose re-
port the state banking board is to act.

The bank in Fargo, the largest city of the
state, with which the League did most of its

310

THE FAMOUS BANK CASE

business, was called the Scandinavian-Ameri-
can. It was supposed to be one of the
strongest banks in the Northwest. Of a sud-
den the people of the state were astonished
to learn that the state banking board, ignor-
ing the state bank-examiner, had descended
upon the Scandinavian-American, objected to
the presence among its assets of the League's
postdated checks, declared 50 per cent, of the
farmers' notes it held to be worthless,1 an-
nounced the bank to be insolvent, ordered it
to be closed, and placed a receiver in charge.

The law apparently intends that banks
shall be closed only upon the report of a state
bank -examiner. It is unfortunate for any
theory of good faith in these transactions that
there was no report of a state examiner in this
case, and that just before the closing of the
bank the state examiner, Lofthus, had been
sent out of the state by the majority of the
banking board. The action may have been
innocent enough, but it gave to the subsequent
proceedings an appearance of unfairness, since
Lofthus was generally trusted and might be
depended upon to make an impartial exami-
nation of the bank's affairs, if he had been so
requested. It appears that no such request
was made of him.

The sudden closing of the bank created a

1 Many of these notes were contributions to or loans ma.de by the
League.

311

THE STORY OF THE XOXPARTISAN LEAGUE

situation of the gravest moment for the
league. In the first place, under the condi-
tions prevailing for grain-growers, if it could
not accept postdated checks no one could say
how it could be financed at all. In the next
place, it had thousands upon thousands of
these postdated checks on deposit in banks
through North Dakota and other states. If
these were now to become worthless the
League was struck a deadly blow, for it could
not by any means raise the cash to make these
checks good, and yet if this position of the
banking board was correct, or should be sus-
tained, every bank in which it had such de-
posits would instantly reject them or demand
other collateral.

In the next place, such an organization pro-
ceeded, and must proceed, largely on the basis
of its credit and prestige, and if this ruling
should prove correct its credit and prestige
were annihilated.

The news agencies sent by telegraph full
accounts of the closing of the bank, and the
next morning it is likely that every newspaper
in the I nited States that had a news first
page displayed this upon it, many with large
head-lines written in what was undeniably a
tone of jubilation. All about the country the
impression was that the League would never
recover from the blow. I was at the time in
a city fourteen hundred miles away, and a

312

THE FAMOUS BANK CASE

gentleman prominently connected with one of
the largest corporations in the country brought
me the news. He came rubbing his hands
and smiling a satisfaction he made no attempt
to conceal. ''That ends the Nonpartisan
League," he said; "they can never get over
such a 'wallop." The corporation with which
he was connected had not a single interest at
stake in the matter. Its business could not
be affected a cent's worth, whether the League
lived or died. He did not live in North
Dakota nor within many miles of it. But he
was overjoyed to have this disaster come upon
the reform movement, only, so far as I could
tell or learn, because of the aroused caste
instinct. Other corporations were involved
if his was not, and his sympathies must neces-
sarily be with the corporations.

His point of view seemed to be generally
shared through the country by those similarly
interested or connected. A New York news-
paper printed an entire page announcing and
exulting in the collapse of the League and all
its program. It bore the page-wide heading,
''Townley's Fiasco Shows Entire State There
Is No Short Cut to Wealth." The article
under this heading began with these words:

"Away out in North Dakota a bank blew
up the other day. It blew up because it was
full of hot air instead of hard cash." The
writer then proceeded to show that this "hot

313

THE STORY OF THE NONPARTISAN LEAGUE

air" was the direct and typical result of the
mad schemes of the Xonpartisan League, and,
the explosion having revealed to the people
fof the state the real nature of these schemes,
they had now abandoned the League, which
was rapidly becoming to them only a pain-
ful reminiscence.

Accompanying this was an illustration of
mounted and masked "night riders" armed
with guns or carrying torches, who were thus
made to appear as typical League members
out upon an errand of destruction.

Meantime the Scandinavian-American Bank
remained closed on the orders of the state
banking board, but its officers and the League
had moved at once to have the case reviewed
by the courts. About twenty days later it
came before the state supreme court, which
heard arguments for and against the action
of the banking board, arid on October 25,
1919, the court handed down its decision.

It found that the bank had been solvent
when it was closed, that the state banking
board had no right to close it and appoint a
receiver without a report from the state bank-
examiner, and that the postdated checks were
good and legal collateral.

The opinion said:

"Further, the acts of the respondents [the
attorney-general and secretary of state con-
stituting the majority of the banking board]

"

THE FAMOUS BANK CASE

in suddenly closing this bank, practically with-
out warning, and in installing a temporary
receiver without the knowledge of the state
examiner, and in suddenly causing telegrams
to be sent to so-termed associated banks of
said bank throughout the state and deter-
mining that certain forms of collateral held
in this bank, as well as in many other banks
of the state, improper collateral and of doubt-
ful value has occasioned unprecedented public
concern, not only in this bank, but in banks
throughout the state, concerning their solv-
ency and concerning the operation of bank-
ing laws of this state and even the credit
of the state."

As to the sending of the regular examiner
out of the state, and the appointment of his
subordinate as receiver, the court said:

"It therefore follows that the action of the
majority of the state banking board was illegal
and unauthorized. Even though it were con-
ceded that the board did possess the power to
close the bank and appoint a receiver, never-
theless the action as taken by the majority of
the board was unreasonable, arbitrary, un-
just, and cannot be upheld."

Concerning the postdated checks and the
general condition of the bank, the decision
said:

"There is no more reason for declaring form-
ers' paper to be of a certain percentage of value

THE STORY OF THE XOXTARTISAX LEAGUE

than there is for declaring lawyers', doctors', or
merchants' paper to be of a certain percentage
of value.

"It is apparent that the acts and conten-
tions of the respondents in attempting to es-
tablish by presumptive fiat that postdated
checks are of no substantial value and at one
fell swoop to render practically valueless or
insufficient all paper for which such postdated
checks as well as other farmers' notes stand as
security are not only presumptions, but with-
out foundation in law. ^Yllat was the intention
of the majority of the banking board in the
acts performed this court does not deem it
necessary to determine. The acts them-
selves, however, are judged by this court. It
is determined that there is such a thing as
public conscience and that these acts upon
the record submitted to this court were un-
warranted, unreasonable, and without foun-
dation of law."

One of the judges filed a separate opinion,
in which he said:

'"The proceedings against the bank were
commenced and conducted in a hostile and
unfriendly spirit, with needless force, high-
priced attorneys and accountants, regardless
of expense, and defendants proceeded to take
possession of the bank and give out reports
detrimental to it and its stockholders.

"In six days after the examiner took pos-

THE FAMOUS BANK CASE

session, his report to the court shows that the
bank is not insolvent; that it has in cash
three hundred and fifty thousand dollars; and
that on paper which the defendants rated as
not bankable the examiner has collected one
hundred and sixty -nine thousand dollars. The
report of the examiner shows that the bank is
solvent and that it is well prepared to do
business.

'"Now it appears that the bank is not in-
solvent and, on the contrary, its solvency is
fully assured and the defendants have no right
to insist that they be permitted to wreck it.
Indeed they have no legal interest in the mat-
ter; they have no rights to protect. They
represent neither the bank nor its creditors,
depositors, or stockholders; neither the state
nor the public welfare. Hence the judgment
of this court is and must be to the effect that
the bank be restored to the full right to do
and transact its ordinary business without let
or hindrance, and that all proceedings against
it be dismissed with costs."

Two of the five judges dissented.

Immediately upon these findings the bank
was reopened.

On the first day the deposits exceeded the
withdrawals by nearly forty thousand dollars,
notwithstanding that while the bank had been
closed the merchants of Fargo had accepted
checks upon it, and that these, having accuinu-

317

THE STORY OF THE XOXPARTISAN LEAGUE

luted, were naturally presented for payment
on the first day.

Among the men that crowded to the bank
with deposits was a fanner named Frank
Bennett, whose post-office address is Har-
wood, North Dakota. He gave to a reporter
two reasons why he wished to do everything
in his power to sustain the bank. I give them
here because they seem to me of even greater
importance than the closing and reopening of
the concern.

He had just sold a thousand bushels of
wheat that had been graded as No. 3, and for
which he had received $2.20. At that time
Xo. 1 wheat was selling for $2.35 a bushel, so
that he received for Xo. 3 only 9 cents a
bushel less than he would have received for
Xo. 1.

To see what this means it is only necessary
to turn back to what has been said in another
chapter about the difference under the old
system between prices paid for wheat and
the actual milling value of the same wheat.
Bennett was now paid on the basis of the
milling value of his wheat. A few months be-
fore he would have been paid on the basis of
the whcel-of-fortune in Chicago, modified by
the superior grabbing ability of a long line of
middlemen between Chicago and Harwood.
lie would have received, therefore, about $2.05
a bushel instead of $2.20.

THE FAMOUS BANK CASE

Moreover, he had been paid $17 for the
dockage on his wheat, and in the old days
that would have been taken from him.

He had still another reason to stand by that
bank and the whole program of the League,
which it had come to represent. On the same
day that the supreme court decision was pub-
lished appeared also certain reports of the
officer Doctor Ladd had appointed under the
new law to investigate the scales used by ele-
vators and grain firms that bought the farm-
ers' wheat, and some of these findings were
of a truly astounding nature.

Doctor Ladd's investigator was D. J.
McGrath, an expert scales mechanician se-
cured in Minneapolis. He had nothing to do
with the farmers' fight; his business was to
test weighing-machines. In the first few days
he found and destroyed a wagon-load of false
scales and scale parts, and proved that the
charges of the farmers about underweighing,
which had been widely ridiculed or denounced
as preposterous, fell short of the truth.

I will give one illustration. On every scale
beam there is a slight projection or nub that
prevents the weight from sliding beyond the
zero mark. Mr. McGrath found that this had
been filed off, so that the weight would slide
back of zero. Further investigation showed
that one of the weights used on this scale had
been plugged with lead.

319

THE STORY OF THE NONPARTISAN LEAGUE

The usage of these two devices was like this :

When the farmer drove his wagon of wheat
upon the scales to have it weighed, the
plugged weight deprived him of about seventy-
five pounds of the true weight of his cargo.
After the wheat, being thus fraudulently
weighed, had been shifted from the farmer's
wagon to the elevator, the empty \vagon was
driven upon the scales to be weighed, that its
weight might be deducted from the gross
weight of wagon and wheat. Then the scale
weight on the upper beam would be pushed
beyond zero, with the result that about
twenty-five pounds would be added to the
apparent weight of the wagon and deducted
from the total amount of the wheat.

By this arrangement the farmer was cheated
of amounts varying from fifty -five pounds on
every one thousand pounds to one hundred
and thirty-five pounds in ten thousand.

Not only was this definitely proved, but
Mr. McCirath was able to make up, in one
instance, a bill of $3, .'391 against one elevator
for wheat it had secured in this way from
certain fanners.

It appeared, therefore, only too likely that
the estimate of the farmers of five hundred
thousand bushels of mysteriously disappearing
wheat every year was far under the real figures.

In the view of the victims the chance to
escape from these practices was bound up in

THE FAMOUS BANK CASE

the fate of this bank. If postdated checks
had been ruled illegal the League could hardly
operate; if the League went to wreck the old
system would return and, in the farmers' be-
lief, bring the false scales with it and all the
other practices that had made farming in
North Dakota an unprofitable business. No;
I am wrong. It was not truly a business at
all, but a form of drudgery for the bare bones
of existence.

But the battle was saved and the bank re-
opened. And. now remains to be recorded a
strange fact. I have said that the news of
the closing of the Scandinavian-American was
telegraphed to every corner of the country
and printed everywhere. One would natu-
rally think that the news of the reopening
would be at least as interesting. Yet this
news, if telegraphed at all, was scarcely
printed anywhere, and to this day the public,
in the eastern part of the country at least,
still believes that as a result of the extrava-
gant and impracticable schemes of the Non-
partisan League the bank was permanently
ruined. There may be some just and inno-
cent explanation of this, but I do not know
what it is.

In such conditions it is not to be wondered
at if some of the League members gathered
bitterness and believed that, in their own
words, the cards were stacked against them.

3£1

CHAPTER XIX

REASONABLE CONCLUSIONS

IX the face of these and many other obsta-
cles, fighting incessantly for its life, the
League continued to make progress, to extend
itself steadily and to enroll new members. I
think that all fair-minded men, if familiar
with American politics and American psy-
chology, will admit that this is the most note-
worthy fact about it. Public opinion is more
potent in America than in any other country
on earth; public opinion here is the absolute
monarch of all public and most private ac-
tion. One might say that all the expressions
and organs of public opinion were against
the League. The greater part of the press
had been engaged for four years in show-
ing to the world the League's evil principles
and depraved control. In serious argument,
in fervent appeal, in limitless jokes, burning
sarcasm, and the best cartoons, it had been
bombarded and ridiculed. Eloquent speakers
had toured the Xorihwest exposing the deadly
peril of the new doctrines. In all the cities

REASONABLE CONCLUSIONS

and towns the better element unanimously
condemned it. Bankers pointed out that it
would ruin the country's prosperity, and
clergymen from their pulpits called it im-
moral and a flight in the face of Providence.
One cynical onlooker said that ten thousand
words were uttered and printed against it for
every word in its favor. In spite of all this
it continued to grow. The fact was not in
accordance with prophecy nor the run of
American experience. So far as I can see it
could mean only a deep-seated conviction
among the farmers that they had suffered
wrong and that this was the way to right that
wrong. By October 1, 1919, the League had
two hundred and forty-five thousand dues-
paying members, had three representatives
in Congress, was organized in thirteen states,
and was being urged to enter as many more.

To the attacks upon its principles the mem-
bers had responded by reaffirming them. To
the attacks on the officers the members had
responded by re-electing them. To the at-
tacks on the form of organization the members
had responded by reiterating it.

Not by any possibility could these things
happen without a profound, underlying causa-
tion. Such a movement might last for a year
or two years in the face of ceaseless attack,
but not four or five, and grow all the time.
The perfect faith of the politicians of the old

22 323

THE STORY OF THE XOXPARTISAN LEAGUE

machine was that the farmers would never
hold together. The commentary upon that
is the League's vote and membership roll.
Yet even that is not complete. To grasp all
that is portended by these records, it is neces-
sary to attend a meeting of typical North-
western farmers and note well what under-
currents of resolution, sober, reasoned, well
informed, and at all times indomitable, show
forth at every crisis to sweep away the last
doubt. The forces opposed to this movement,
the most significant of our times, are great,
powerful, relentless, well equipped. They
may yet succeed in wrecking it. But so far
this fact is certain that they have employed
against it the full armory of their resources
and with all their power have only speeded
it upon its way. And to that fact, coupled
with one other, that there are ten million
farmers in the United States, I invite the
attention of the thoughtful.

AVe have never had in this country at large
a division in politics based upon the bread-
earning vocations of men; we have never had
the fanners voting as farmers, the wage-
earners as wage-earners. With ten million
fanners in the country there are not a score
in Congress; with four million wage-earners
organized into trade unions, labor is all but
unrepresented. If the idea struck out in the
mind of the bankrupted North Dakotan as

REASONABLE CONCLUSIONS

he trudged the roads of his state — the idea
that has now, after all these eventful months,
become so powerful a factor there — should
spread across the continent, we should as-
suredly see greater and more astonishing
changes in our political methods than our
forerunners ever dreamed of, and from these
records the reader can easily estimate what
evolutionary results might follow in the na-
tion's economic and industrial life.

However this may show in the sequel, the
fair, and I believe the sure, deduction from
this record of a remarkable struggle is that it
is part of the long conflict men have waged
through every generation against the injus-
tice that poisons mortal existence. And next,
that it has set a new mark in that struggle.
The Nonpartisan League may go to pieces
next year or it may become a permanent feat-
ure in our political system; I do not know.
But I do most earnestly believe that the mark
it has set will never be removed.

INDEX

Abandoned farms In the North-
west, 5.

Anderson, J. M., president of the
Equity, prevents a riot at Fargo
when the police break up an
Equity meeting, 134.

"Appreciation Week" in North
Dakota, 179.

Armour- Peavey oats deal of 1906,
137-158.

"Back to the Land!", fallacy of,
(i:5.

Hank of North Dakota: establish-
ing of. 236; practical operations
of; 299-300.

Banks: power of, in North Dakota
and the Northwest, 17, IS, 126;
attitude of, toward co-operative
enterprises, 127; used to support
''Better Farming" movement,
177-178.

Barnes, Julius, advises against
state-owned elevator, 105.

Bennett, Frank, of Harwood,
North Dakota, actual experi-
ences under reforms instil u ted
by Nonpartisan League legis-
lature, :>is.

"Better Farming" movement, the:
charged with being a device of
Big Business, 175; origin of its
funds, 17(1; assisted by United
States Department of Agricul-
ture, 170; collapse, 177.

Chicago Board of Trade, annual
dealings in futures, 158.

Co-operative experiments: in Eng-
land and elsewhere, 113; with
"Farmers' elevators." 123-127.

Creel, George, formerly chairman
national Committee on Public
Information : magazine article
relating to loyalty of League,
244; letter concerning same sub-
ject, 245-246.

Dockage, regulation of, by Non-
partisan League legislature, 261.

Drake, Benjamin, testimony of:
concerning weighing abuses, 74;
concerning indictment of J. J.
McHugh, 139.

Duluth Board of Trade: controlled
by Minneapolis Chamber of
Commerce, 141; refuses to con-
fer with committee of North
Dakota Bankers' Association,
144-145; testimony of II. T.
Fowler concerning, 14'J.

Duplicated commi>sions in grain-
handling: testimony of F. B.
Wells concerning, 44-45; te.-ti-
mony of G. F. Ewe, 4S-44; tes-
timony of lion. James Manahau,
45-46'

Ewe, G. F., testimony of, concern-
ing ownership of "line" eleva-
tors, 43-45.

Case, George E., testimony of, Fulls of St. Anthony: importance
concerning wrecking of the of, 1:?: ownership of, 14.
Farmers' Exchange, 114. False balances and questionable

THE STORY OF THE NONPARTISAN LEAGUE

weighing methods in the grain
tnide: report on, by committee
of North Dakota Bankers' Asso-
ciation, 72-73; testimony of Ben-
jamin Drake concerning, 74; dis-
coveries of D. T. McGrath con-
cerning, 319-320.

Farm profits: popular notions
about, 3, 1; cost of raising wheat,
acre, 5!); farmer's balance-sheet
compared with grain-buyer's,
57-58: less than a ditch-digger's
pay, 01; average of, on fifty-six
farms in Clay County, Minne-
sota, 02; average of, on fifty-
two farms in Ottertail County,
Minnesota, 02; wheat raised
nt a loss in North Dakota, 31-
L<2

Farmers, the: their share in prices
pi'd by consumers, 1, 00, 61;
disproportionate odds against,
i!2; further notes on their in-
comes, 1S4-185.

Farmers' Alliance, career of, 90.

"Farmers' Legislature," the, of
1917, record of, 224-228.

"Farmer's Hound of Pleasure,"
the, 92.

Fowler, II. T., testimony of, con-
cerning Duluth Board of Trade,
140.

Frazier, Lynn .!.: a modern Cin-
cinnatus, 210; chosen as Nonpar-
tisan lyvague's first candidate for
governor, 210; character and
experience, 210; carries North
Dakota in primaries of 1910,
210; first election as governor,
2-'.0; renominated, 1918, 24«;
re-elected, 250.

"Good men" and "bad men" in
reform, 187.

Gram Buyers' Combination, re-
port concerning, by committee
of North Dakota Banker*' As-
sociation, 82.

Grain exchanges, profits of, 12.

Grain futures: extent of trading

in, 159, 100, 161; opinion of
committee of national House of
Representatives concerning evil
effects of, 161-16:2.

Grain grades, grading and inspec-
tions: typical instance, 27-29;
explanation of, 39 n.; "No
Grade" explained, 30-31; sys-
tem of, 38-39; appeals from, in
Minnesota, 56; made without
farmers' participation or con-
sent, 82, 86; spurious "Feed"
grades, 82; demonstration at
North Dakota Agricultural Col-
lege of their falsity and injustice,
83; tables of farmers' losses on
"Feed" grades, 84-85; wholly
arbitrary, 80; Doctor Ladd's
estimates of the total losses on
these grades, 80; scandalous in-
stance of controlled grading in
connection with Leiter wheat
deal, 154; reformed by legislature
of North Dakota in session of
1919, 200-263; operation of these
reforms, 273—275.

Gn.in Growers' Company of Mani-
toba, 139.

Grain-growers' convention broken
up by police at Fargo, 133.

Gr.:in trade, reforms in, demanded
by Minnesota farmers, 172.

Grange, the, in politics, 97.

Greely, Samuel Hallett, testimony
of, concerning grain-dealing and
"phantom grain," 158-159.

Hayes, Willett M., estimates of,
concerning dealings in grain fu-
tures, 159-101.

Hill, James J. : power of, in the
Northwest, 100-101, 100; de-
cides against state-owned eleva-
tor for North Dakota, 105.

"Home-builders' Act," passed by
North Dakota, legislature of
1919. 270-271.

Id;; ho, action of legislature against
Noupartisan League, 305.

INDEX

Industrial Commission of North
Dakota, 200.

Knutson, Olaf, experiences of, with
farm loans, 36.

Kraabel, A. T., Lieutenant-Gover-
nor: indorsed by League, 211;
makes up committees against
League program, 222.

Labor conditions in North Dakota
reformed by legislature of 1919,
266-270.

Ladd, Dr. E. F. : researches in
wheat values, 60; services to
the farmers of America, 78 n.;
estimates of total losses to farm-
ers on the spurious "Feed"
grades. 86-87; estimates of
losses on screenings, etc., 87;
made inspector of grades,
weights, and measures for North
Dakota, 273; extent of his power
in that office, 274; results he
achieved, 275.

Leiter wheat deal of 1898, 154.

"Line" elevators: numbers and
the extent of their business, 41-
44; maneuvers to crush farm-
ers' competition, 124, 127; fa-
cility in obtaining cars from the
railroads, 126.

Loans on warehouse receipts, prac-
tical workings of, 298.

Loftus, George S. : career and pub-
lic services, 135; compels Pull-
man Company to reduce charges,
135; made sales-manager for the
Equity Exchange, 136; experi-
ences with Minneapolis banks,
136.

MeGrath, D. T. : employed as
scale expert by Doctor Ladd,
319; finds many false and manip-
ulated scales in grain trade, 319—
320; bills one elevator for $3,391
for false weighing of grain,
320.

McHugh, J. J., secretary of Minne-

apolis Chamber of Commerce:
testimony of, concerning false
switching charges, 65-G6; testi-
mony of, concerning immunity
of the Chamber of Commerce,
70; testimony of, concerning
control of members, 71; indicted
at Winnipeg on charge of con-
spiracy in connection with ex-
pulsion of co-operative Grain
Growers' Grain Company from
Winnipeg Exchange, 139.

Manahan, lion. James: testimony
concerning grain-handling and
commissions, 45; testimony as
to effect of Chamber of Com-
merce on independent and out-
side millers, 46-47; confirmed
by committee of North Dakota
Bankers' Association, 51; exam-
ination of Secretary McHugh
on switching charges, 65-66.

Market manipulations: table of
corn prices for one year, 153;
instances of, 153-154; famous
Leiter-Pillsbury deal an illus-
tration of, 154; "Dardanelles
Fake" created for this purpose,
156; losses to farmers in one
year by reason of, 156; Armour
wheat 'raid of 1915, 156-157;
Armour - Peavey oats deal of
1906, 157-158.

Millers' Association, the Minne-
apolis, forerunner of Chamber of
Commerce, 14.

Millers, independent: unable to
get the kind of grain they need,
46, 145; testimony of Hon.
James Manahan concerning, 46,
47; statement of committee of
North Dakota Bankers' Asso-
ciation concerning, 50-51.

Mill feeds, value of, 61.

Mining laws, advanced nature of,
adopted by North Dakota legis-
lature of 1919, 269-270.

Minneapolis : world's greatest grain
market, 13; great importance of,
in the financial world, 17, 18;

329

THE STORY OF THE NOXPARTISAX LEAGUE

its hanks dominated by the
milling interests, 19.

Minneapolis Chamber of Com-
merce: foundation of, 15; ab-
normal legal power of, 15, 17;
control of, 16; its star-chamber
courts, 16; interwoven with rail-
road interests, 21; typical day's
trading on, 39-40; operations
with "velvet chat!" wheat, 78;
operations with durum wheat,
78; classification of member-
ships, 69; distribution of mem-
berships, 70; as co-equal with
the government, 70; as immune
from investigation, 71; power of,
71; reports of typical day's
trading on, 112-113; rules for
the buying prices of grain, 155;
annual dealings in futures, 158;
power and operations of, in con-
nection with the Duluth and
Chicago Boards of Trade, find-
ings of committee of national
House of Representatives, 161-
163; investigation of, by com-
mittee of Minnesota House of
Representatives. 174; counter-
acted by investigation of Senate
committee, 174.

Minnesota, attempt of politicians
to strangle Non partisan League
by repealing primary laws, 307.

Minnesota Farmers' Exchange,
the: origin of, 111; buys seat
on Minneapolis Chamber of
Commerce, 114; membership
arbitrarily rescinded, 116-117;
loses twelve cars of grain shipped
to Chamber of Commerce firm,
IIS; manner of its ruin, 119-121.

"Mixing-houses" and terminal
elevator^: record of two years
at Minneapolis, 47; record of
twelve months at -Minneapolis,
48; record of three months at
Duluth, 4'); record of one year
at Duluth, 52; record of a sec-
ond year at Duluth, 53; record
of all Minneapolis terminal ele-

vators for 1911, 54-55; profits
of, 53, 54; secrets of, 55-56.

Money and interest rates in North
Dakota: legal interest rates re-
duced from 1£ to 10 per cent.,
31-35; typical illustration of
method of making farm loans,
£4-26; chattel-mortgage meth-
ods, 25, 26; report on, by John
Skelton Williams, Comptroller
of the Currency, 35; experiences
with, by Adolph Sundahl, 35;
experiences with, by Olaf Knut-
son, 36; Supreme Court upholds
excessive interest rates in North
Dakota, 36; statistics of, in
North Dakota, 36.

Money rates reformed by legis-
lature of North Dakota in ses-
sion of 1919, 256-257.

Montana, attempts of politicians
of, to strangle Nonpartisan
League by repealing primary
law, 303-305.

Nebraska, attempt of the politi-
cians to strangle the Nonpartisan
League by repealing the primary
laws, 305-306.

Nonpartisan Leader, The, first issue
with twenty-two thousand sub-
scribers, 203.

Nonpartisan League, the: first sug-
gestion of, 198; first members of,
11)!); difficulties to secure funds,
2i)(); relations to "postdated"
checks, £00; first known as Farm-
ers' Nonpartisan League, 200;
name chosen by A. C. Townley,
200; members of, solicited on
commission basis, 202; criticisms
and defense of this plan, 202-
203; attacked ;is not democrat-
ically managed, 207; selects L.
J. Frazier as candidate for gov-
ernor, 210; mass state conven-
tion, April 1. 1916. 211, 217-218;
rapid growth of, 212; program
of. 213-214; pledge signed by
members upon joining, 214;

330

INDEX

caste feeling aroused against,
216-217; carries North Dakota
election of 1916, 220; unable to
control legislature of 1917 be-
cause of hold-over senators,
222-223; strength in that legis-
lature, 221; attitude on the war,
229-247 ; blunders of the League
leaders, 232, 233, 234; not dis-
loyal, 233; accused by its en-
emies of disloyalty, 236; incident
of the ''People's Council," 237;
Governor Frazier's telegram gar-
bled, 238; speech by United
States Senator at St. Paul con-
vention used against it, 239;
Townley's attitude toward the
war, 239, 240; war resolutions
of the League, 242; Townley
goes to Washington, sees Presi-
dent Wilson, 243; testimony of
GeorgeCreelconcerningLeague's
loyalty, 244, 245, 246; testimony
of Judge Ben B. Lindsay, 247;
President Townley indicted, 248;
carries North Dakota in election
of 1918, 250; in full control of
legislature of 1919, 250-251;
rueord of that legislature, 251-
279; description of a League
legislative caucus, 253; reform
legislation achieved in legislative
.session of January, 1919, 254-
279; divisions in, after election
of 1918, 281; referendum of 1919
ordered on seven League bills,
282; summary of interests
aroused against it in referendum
of June, 1919, 283-285; bitter-
ness of referendum campaign,
285; canards about "nationali-
zation of women" and state
seizure of fan^ lands, 285-286;
measures voted on at referen-
dum, 287-288; results of vote,
2S9; compared with results of
voting at previous election, 290—
2:*'J; reforming measures at-
tacked in the courts, 293-296;
operations of state-owned flour-

33

mill at Drake, 297; purchase of
Fargo Courier-News attacked in
courts, 302; attempts to throttle
by repealing the primary laws,
302-307; membership and pros-
pects on October 1, 1919, 323;
conclusions concerning, 323-325.

North Dakota: source of the fer-
tility of its soil, 7; character of its
first settlers, 95; their devotion
to the Republican party, 95;
strength of Populist party in,
97; votes of state on state-owned
elevator project, 103, 104; state
Board of Control nullifies vote
of state, 105; provisions of con-
stitution concerning hold-over
senators, 212-213; record of the
" Farmers' Legislature" of 1917,
224-228; Industrial Commission
of, 260; taxation reforms in, by
Nonpartisan League legislature,
264; recall of public officers pro-
posed in constitutional amend-
ment by Nonpartisan League
legislature, 272; changes in edu-
cational system proposed by
Nonpartisan League, 276.

North Dakota Agricultural Col-
lege: laboratory tests of milling
values of different grades of
wheat, 90; findings of, on farm-
ers' losses by undergrading, 90.

North Dakota Bankers' Associa-
tion, committee of: report on
grain-handling at Superior, Wis-
consin, and Duluth, Minnesota,
142; experiences with Duluth
Board of Trade, 144, 145; inter-
view with railroad officers con-
cerning abuses, 147.

North Dakota Mill and Elevator
Association organized by Non-
partisan League legislature, 261.

"Official newspaper" established
in North Dakota, 277-279.

"Old gang," the, alarm at spread
of Nonpartisan League, 204.

Populist party, the: successes in

1

THE STORY OF THE NONPARTISAN LEAGUE

1S92, CO; hampered by ridicule,
98.

"Postdated" checks: necessarily
taken by League in lieu of cash,
200; used in attempt to injure
League through Scandinavian-
American Bank of Fargo, 310-
318.

Railroad freight rates: basis of, 37;
"phantom," between Minot and
Minneapolis, 81; regulated by
Nonpartisan League legislature,
202.

Railroad interests: power of, in
the Northwest, £0; national gifts
to. 37; report of committee of
national House of Representa-
tives eoncerning their relations
with the grain combination, 101.

Railroads in polities, 99-100.

Reformers in history uhvavs at-
tacked, 1S7-188.

Scandinavian-American Bank of

Fargo: closet! by state banking
board because it carried post-
dated checks of the Nonpartisan
League and farmers' paper, 311;
closure denounced by state su-
preme court, 31-1-317; reopened,
317.

Screenings: value of. .50, 51-03;
.North Dakota's losses on, 87-88;
fertilizer value of, 88.

"*MX-do]lar Suckers," 204-20.5.

Society of Kquity: policy c.f. to
ci'iinteract the bribing tactics of
the "line" eli-vators, 129; career
of, an incessant fight, 130; or-
ganizes the Kquity Co-operative
F.xehange, 130; attacked in the
court-. 131; oppressed by the
( hain!>er of Commerce, 132;
denied transfer rights and facili-
ties 132; courage of its ofrie-TS,
131: driven out of Minneapolis
bv the banks, moves to St. i'aul,
137.

S;.:lc hail in.-urance: provided by

Nonpartisan League legislature,
203; menace of, to vested inter-
ests, 285; practical workings of,
298-299.

State-owned flour-mill at Drake,
North Dakota, practical opera-
tions of, 297.

Sundahl, Adolph, experiences with
farm loans, 35.

Superior, Wisconsin: grain trade
of, checked by corporation in-
fluence, 142-143; report of com-
mittee of North Dakota Bank-
ers' Association concerning, 142;
its public elevators made private
by the grain combination, 144.

Switching charges, fraudulent, ori-
gin and nature of the practice,
05-09.

Taxation in North Dakota re-
formed by legislature of Janu-
ary, 1919, 204-200.

Terminal elevators: enforced ne-
cessity of state ownership of, 102;
first vote of North Dakota on,
103; second vote of North Da-
kota on, 10 i; recommendations
of committee of North Dakota
Bankers' Association concerning,
148; logic of, 149; provided for
by Nonpartisan League legis-
lature, 201.

Thompson, W. E., chief clerk,
Minnesota Railroad and Y\are-
hou.-c Commission, report of.
54-55.

Townley, Arthur C.: engage.s in
farming on a large scale at
Beach. North Dakota, 191;
planting flax, 191; ruined by
decline in market, 192; studies
conditions th'it make farming
unprofitable, 194; tours through
North Dakota, 190; meets with
F. B. Wood. 197; appearaiu e
and traits. 198; first success. 199-
2(H); launches the Farmer^' Non-
partisan league, 200; audacity
as leader, 201; speeches on K:c

332

INDEX

war, 239, 240; interviews with
President Wilson, George Creel,
Herbert Hoover, 243, 245; in-
dicted in Minnesota, 248.
Turner, John Kenneth, cited on
wheat prices, 80.

Warehouse receipts, loans upon,
aa instituted by the Nonpartisan
Ixjague legislature, 259.

Weighing abuses abolished by Non-
partisan League legislature, 200.

Wells, F. B.: testimony of, con-
cerning ownership of "line" ele-
vators, 41-43; advises against
state-owned elevators, 105.

Williams, John Skelton, Comp-
troller of the Currency, report
of, on North Dakota loans, 35.

Worst, Dr. John H., formerly
president of North Dakota Ag-
ricultural College: address on
farmers' problems, 181; ousted
from his position for this, 183.

THE EXD