JULY 2018

JULY 2018
One Hundred Years Later, Same Message. 1916 - 2017


Friday, October 16, 2015


I wish the average modern libertarian could meet Jay Gould, because he was unfettered capitalism in the flesh, “the human incarnation of avarice,” as one minister described him, the Mephistopheles of Wall Street, the robber baron par excellence, “prince of the railroad schemers”, and the man within whom all the theories of the libertarians about capitalism and freedom met the reality of human nature, and got the living tar beat out of it.
He (above) was a “…short, thin man with cold black eyes, a narrow face and, in his maturity, a “full black beard”. Born into poverty, his mother was active in the Methodist Church until her death, when Jay was 10 years old. When he was seventeen, Jay apprenticed himself to a surveyor, Mr. Oliver Diston, at the salary of $10 a month. When Jay started issuing his own maps for sale, Diston sued his apprentice. Jay’s attorney, Mr T. R. Westbrook,  managed to have the lawsuit dismissed. But, as one biographer noted, from that day forward, “…there was scarcely a day during his whole life that (Jay Gould) did not have some litigation on his hands.”
His map business made Jay $5, 000, which he invested with Zadock Pratt, a Manhattan leather merchant. Smothering Mr. Pratt in adoration, the 21 year old Jay proposed to write the older man’s biography. That project drew the pair into a partnership in a new leather tannery south of Scranton, Pennsylvania. Using  Pratt’s money, Jay built an entire company town, which he named “Gouldborough”. He wrote Pratt sycophantic letters, in one describing the organizing meeting for the new community. “Three hearty cheers were proposed for the Hon(erable) Zadock Pratt…This is certainly a memorandum worthy of note in your biography, of the gratitude and esteem which Americans hold your enterprising history.” However Mr. Pratt, who knew a lot more about the tanning business than did the young Jay Gould, had begun to see through the fog of compliments.
Pratt (above) showed up at the plant unannounced in the summer of 1858, to go over the books.  He quickly discovered them to be a confusing mess, showing unauthorized risky investments, including in a private bank which Jay had established in Stroudsburg, Pennsylvania. But the company did not share in the bank's profits. Those went only to Jay Gould. Pratt decided to fire his erstwhile friend and sue him to take ownership of the bank.  However, Jay had anticipated this, and had already lined up a richer and more docile partner. In August,  when confronted by Pratt, Gould stunned the man by offering to buy him out for $60,000. Pratt quickly accepted. The cash for the buyout had come from Jay’s new partner, Charles Lessup.
But it wasn’t long before even the somnolent Lessup began to suspect he was being had, too. By the fall of 1859 Lessup was panicked by the commitments Jay had made, using his good name. But it was too late. On 6 October, 1859, facing financial disaster, Charles Lessup shot himself.  Lessup’s daughters bitterly demanded Jay repay them for their father’s lost investment, and Jay countered with an offer of a payment of $10,000 a year for six years. He had, of course, neglected to include any interest during the five year delay. Unfortunately for Jay, the Lessup families’ lawyers caught the omission. Still, in the early months of 1860, it became clear that Jay was hiding huge assets from the family.
Lawyers and 40 deputized men were dispatched to the tannery on Tuesday morning, 13 March, 1860. They flashed the legal papers, ushered the workers out and padlocked the doors. They held the place for a little over six hours, until Jay returned from New York. Just past noon some 200 men stormed the building with axes, muskets and rifles. Four men were shot, others were badly beaten, and according to the New York Herald, “…those who did not escape were violently flung from the windows and doors…” As Jay Gould would later boast, “I can hire one-half of the working class to kill the other half.”  The courts would eventually throw Jay Gould out of the tannery, but by then he had shifted his operations to a place more suited to his nature; the unregulated economic free-for-all that was Wall Street.
While North and South battled over slavery, Jay Gould battled over wealth. He formed his own brokerage firm -  Smith, Gould and Martin. Like all of Gould's  partners, Smith and Martin  were soon left behind. Gould  then made the acquaintance of James “Big Jim” Fisk, who made a fortune smuggling southern cotton through the Federal armies, and selling Confederate War Bonds. And even while brave men died in their tens of thousands,  Gould and Fisk joined with Daniel Drew, director of the Erie Railroad, in their own, private war.
Their enemy was Cornelius Vanderbilt (above), who owned every railroad in the east except the Erie. Naturally, “The Commodore”, as Vanderbilt liked to be called, was seeking a monopoly, so he could charge whatever freight rates he wanted, and he began to buy stock in the Erie. Sensing blood in the water, Jay and friends printed up 100,000 new shares of Erie stock, which The Commodore promptly bought, and which the board of the Erie – Drew, Fisk and Jay Gould – immediately declared to be worthless.
Bilked out of $7 million, Vanderbilt filed legal papers to examine the Erie’s books. Jay and friends grabbed the company records and retreated to New Jersey, where they re-incorporated. Vanderbilt then had arrest warrants issued for all three men, but since New York law could not touch them in New Jersey, the Commodore began to assemble ships and men to invade that state,  all by himself. While the Erie Board prepared to receive the invaders, Jay managed to slide a bill through the New York State assembly making the issuing of worthless stock, perfectly legal, retroactively.
This trick was managed by the simple expedient of giving William “Boss” Tweed (above), the head of political graft in New York, a seat on the Erie board. That brought the Erie War to a temporary pause. And if you are feeling sorry for the Commodore, remember that Cornelius himself once said, “Law, what do I care about the law? Ain't I got the power?" -  another libertarian hero.  The entire bunch were so busy cheating and stealing they barely noticed the end of the Civil War.
With the Commodore’s cash, and further fortified by looting the Erie’s assets, Jay, Fisk and Drew began their own complicated scheme to raise freight rates on the Erie Railroad. Using the profits from that scheme, in 1869 they began to buy and hoard gold, because raising the price of gold would raise the price of wheat, which would allow them to raise the freight rates they charged farmers for shipping the wheat. As insurance the trio took on another partner, Abel R. Corbin, who happened to be President Grant’s brother-in law. The new partner gave the appearance that “the fix” was in, and other investors jumped on the bandwagon. The price of gold skyrocketed.
When President Grant learned about the manipulations, he immediately ordered the U.S. Treasury to sell $4 million in gold. On 24 September 24, 1869, the sudden influx hit the market like a bomb, and gold dropped 30% in a day. The date would henceforth be known as “Black Friday” - at least until October of 1929. Thousands of investors were wiped out, including Abel Corbin. An angry mob swarmed the Gould’s brokerage offices, smashing the furnishings and chanting “Who killed Charles Lessup?” Of course the trio of Gould, Fisk and Drew, walked away from the wreckage with an $11 million profit.
Gould's own partner Daniel Drew was to be his next victim. In 1870 Fisk and Gould sold their shares in the Erie to their one time enemy the Commodore, for $5 million. The deal gave Vanderbilt his monopoly, but it also revealed that the Erie was bankrupt. And it left Daniel Drew, abandoned by his partners, out $1.5 million. He would die flat broke nine years later, just one more partner and one more victim of Jay Gould.
Big Jim Fisk was saved from a similar fate when, in 1871, a competitor for a woman shot him to death in a New York Hotel. After that Jay was reduced to stealing from lesser partners, such as Major Abin A. Selover, who actually considered himself a friend of Gould’s.  It was Selover who introduced Jay to a California friend of his, James R. Keene.  After Keene and Selover had both been battered by Gould in a contest for control of telegraph company, Western Union,  Jay and Selover happened to meet on the street one day. Jay tried to walk past, but for once in his life, Jay Gould had been caught out in the open.
Selover grabbed Jay be the collar and shouted, “I’ll teach you to tell me lies!” The six foot tall Selover then threw Jay to the ground, and then yanked him up again by one hand, dangling him above the stairwell of a below-street level barbershop. With his free arm Selover began slapping the Mephistopheles of Wall Street and shouting, “Gould, you are a damn liar!” Nobody who witnessed the event interrupted to disagree. When Selover finally let go, Gould dropped 8 feet to the stairs. A stock broker the next day quipped, “It was characteristic of Mr. Gould that he landed on his feet.”
Overnight, Abin Selover became the most popular man in New York City. Jay Gould was smart enough not to press charges, since no jury could be expected to convict anyone of assaulting Jay Gould. Henceforth, Jay never went out without a body guard. He began to describe himself as the “most hated man in New York”, but there was a touch of pride in his voice when he said it. Selover eventually went broke, as did Keene. However, when he finally died in 1892, Jay Gould was the ninth richest man in America, worth about $77 million. He died a hero only to those who never did business with him. Gould scoffed at the idea that Wall Street should be regulated. “People will deal in chance….Would you not, if you stopped it, promote gambling?”
It was and is a philosophy which fails to see an advantage to drawing a line between gambling and investing. It is the philosophy of libertarianism. It is the philosophy of unmitigated greed. It was the philosophy of Jay Gould.
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Wednesday, October 14, 2015


I suppose someone had to be first, and John Billington was as  likely a choice as any other man. Rumor has it that John left England in 1620 to escape his creditors. That would not have been unusual in a time when debt was a crime. Still, if he was a Catholic, as others rumors indicate, that would also have been enough to drive John Billington to abandon the world he knew in England,  for the dangers of a distant, unsettled shore, seeking religious freedom. He did not find it, even on board the ship he took to America. Sixty-one of the passengers were either Anglicans or, like John, Catholics. But still they were despised by their shipmates, on board the "Mayflower", who were themselves the despised "Pilgrims Fathers".
John Billington was also middle aged, about 40 years old, rather ancient for an adventurer. He was accompanied by his wife, Eleanor, and their two young sons, John Jr. and Francis. And together their family was beginning a great adventure they were not welcomed upon. 
The voyage had been organized by a group who called (and saw) themselves as “The Saints”. And they were not pleased to find the financial investors in their dream had betrayed them. Not enough "Saints" had been willing to buy passage to America. so the investors had sold the majority of berths to what the Saints called "The Strangers". 
The 102 "Saints" and "Strangers"  found themselves stuffed aboard a leaky ship, just 90 feet long by barely 24 feet wide, giving them 2,160 square feet of living space (a moderate sized two bedroom house). Add a 20 man crew and "The Saints", seeking to escape the horrors of a multi-faith nation, found themselves imprisoned with and dragging it along with them. And they found the burden oppressive. They couldn't wait to get off this damn boat, and start oppressing "The Strangers". 
After two and a half months of living hell on storm tossed seas the Mayflower anchored at the edge of the New World, sheltered by a sandy cape. And it was here that "The Saints" faced what they called a “mutiny”. Through the myopia of history, we choose to describe it as "the birth of democracy in the new world".  The problem was "The Strangers" were not being landed where they had been promised, in the established colony of Virginia, but on unexplored and unprepared ground far to the north. And "The Strangers" were suspicious that this had been the intention of "The Saints" all along. And indeed that seems to have been the truth. Just to get "The Strangers" to disembark  "The Saints" were forced to compromise their faith, right on the edge of their religious paradise, and to sign the Mayflower Compact with "The Strangers", pledging to “…combine ourselves into a civil Body Politic…”
"The Saints" were thus forced to create a civil government in this new land, and not the mono-religious domain they had intended.  And one of the signatures bought by that accursed compromise had been that of John Billington. 
As if in punishment for this compromise of their religious purity, only fifty-three souls survived that first winter. Amazingly, John Billington’s family of "Strangers" survived intact – including Eleanor, who became one of only five adult women who lived to see the spring. Both of John's sons also survived, another insult to the devotion of "The Saints",  many of whom had buried children and wives over the bitter winter.  The Billington clan had become a daily reminder that God’s Chosen had not been chosen. It must be they were being punished for the "Mayflower Compact".  More evidence was to follow. 
In the spring of 1623, the second full year the colonists were ashore, pressure from the "Strangers" forced the Governor, William Bradford (a "Saint", of course) to divide all property equally among the survivors, one acre per family member, no matter their religious affiliation. And thus the Billington clan received four acres of the best land, “…on the South side of the brook to the Bay wards”. It was yet another reminder of the success of "The Strangers". These insults to the faith of "The Saints" would not be forgotten. 
Meanwhile, "The Saints" back in England had begun spreading rumors about the failure of the Plymouth Bay Colony, hoping to drive down the price of the stock,  making it easier for "Saints" to buy a controlling interest in the company.  And with each year they sent more "Saints" across the Atlantic, meaning to overwhelm "The Strangers" in Massachusetts Bay.  By 1624, the colony had grown to over 180 people. But two of the new arrivals, meant to build a Saint's majority, had in fact fed the growing tensions.

The Reverend John Lyford and Mr. John Oldham were both nominally "Saints". In fact Lyford had been sent out as the official priest for "The Saints" in the colony. 
But Lyford's willingness to conduct an Anglican baptism for the new child of "Stranger" William Hilton offended "The Saints".  These chosen by God saw no reason to tolerate religious tolerance for anyone but themselves. And Governor Bradford became convinced that Lyford and Oldham were both secretly corresponding with the stockholders back in England, contradicting the false rumors the English Saints had been spreading. 
Bradford was able to intercept some of those letters, and confront the traitorous "Saints" with telling the truth, catching them unprepared at a public hearing. Both Lyford and Oldman were banished from the colony that very night. At the same meeting there was also an attempt to charge John Billington with being a member of the same "conspiracy",  but there was little evidence against Billington, and he was popular, (although it seems unclear how he could have been so, given the negative descriptions of him that survive) "The Saints" were forced to retreat and bide their time, yet again. 
The following year, 1626, James I of England died, and Charles I (above), a militantly devout Catholic, took the throne. The trickle of "Saints", escaping now from actual religious oppression in England, became a steady flow.  John Billington still had allies in Plymouth Colony,  such as John Cannon and William Tench, but the pressures created by the influx of new "Saints" drove both those men to leave the colony by 1627.
And in 1629 John Billington's eldest son died of illness. With his death, some of the flame went out of the old man. He was fifty now, and weary of the constant fighting for his families' rightful place in the colony. By January of 1630 there were almost 300 citizens in Plymouth colony, the vast majority of whom were now, finally, "Saints". John Billington had become isolated. 
In the late summer of 1630 a man’s body was found in the woods near John Billington’s property. The body was identified in Governor Bradford’s correspondence only as "John New-come-er”. No rational for Billington to have murdered this mysterious man was offered on the record. Instead surviving documents allege that the motive was the result of “an old argument between the two men”. But this would seem unlikely, given that the dead man was, by every account, a literal “New-come-er”". 
Despite this glaring omission of motive, a Grand Jury was quickly convened and John Billington was charged with shooting the man in the shoulder with a blunderbuss, thus causing his death. 
But by this time there was little patience left in the colony for reason where the Billingtons were concerned. A trial jury wasted little time in finding John guilty of murder. And yet despite the singularity of this crime and possible punishment - Billington was the first Englishman in the colony charged with murder, and would be the first colonist to be executed - there is no record of any defense offered on his behalf. "The Saints" had won their war against John Billington, and they would write his history. And yet because there was a lack of any apparent motivation for the crime, Governor Bradford sought the approval for the execution of this "Stranger" from his own fellow "Saints" in the younger, larger and more purely Saintly Massachusetts Bay Colony, centered on Boston. Such approval was instantly supplied. 
On 30 September, 1630, fifty year old John Billington was hanged according to the methods of the day. He climbed a ladder. The rope was placed around his neck and the noose pulled tight. The ladder was kicked away. And slowly the life was strangled out of him as he danced at the end of the rope. The drop that quickly broke the neck would not become standard in hanging for another two hundred years. Plymouth Colony was thus finally rid of its most troublesome "Stranger" in a congregation of "Saints". The only even mildly generous epitaph written for John Billington came from the poison pen of Thomas Morton, another man who irritated "The Saints" who surrounded him. Morton wrote, “John Billington, that was chocked at Plymouth after he had played the unhappy marksman...was loved by many.” And that is a piece of information not even hinted at in the history written by "The Saints" - that John had been loved by many. 
Sixty years later the "Saints" would have to clean house again, this time in the village of Salem, and this time against their fellow "Saints" who were not saintly enough. Fourteen women and five men were hanged this time. Five others died in prison. All had been charged with being witches. What this re-occurrence of justice from "The Saints"  showed, was that even before there was religious freedom in America, there was religious hypocrisy.
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Sunday, October 11, 2015

MAKING PEACE - Four - Theatrics

I am certain the Soviet attack was a total surprise for the Japanese military leadership. First, wishful thinking had convinced the high command that the Soviets would not attack until the spring of 1946. There were good practical reasons for this delusion. The Kwantung Army, occupying Manchuria and facing the Russians, had once been the largest in the Japanese army  (1, 300,000 men),  and promoted its commander Hideki Tojo to Prime Minister and war leader.  But by August of 1945 it  had sent  half its strength south to reinforce the 2nd Army facing the American threat to Kyushu, leaving behind 25 under strength divisions with 1,200 light tanks and 1,800 obsolete aircraft, and just 50 Zero fighters. And the Japanese had no more fuel in Manchuria than they had in Kyushu.  They had to believe the Russians would not attack, or they would panic.
One minute into Thursday  9 August, 1945,  three Soviet "Fronts" (the equivalent of American army corps) fell upon the Japanese with 1,500,000 men in 89 divisions, with 3,700 heavy tanks and 3,700 state of the art front line combat aircraft. The last surprise for the Japanese was the method and location of the attacks. In the south, the TransBaikal Front came across the mountains and desserts of Mongolia, a path that seemed impossible because they could not be supplied through that line. 
What the Soviets did was something the U.S. would repeat on a much smaller scale in Iraq in 1989.  Soviet parachute troops captured Japanese airfields far behind the front lines and food and fuel were then flown in, turning them into supply depots for the advancing ground troops. 
The Trans Baikal thrust was aiming for the city of Changchun, where they would meet the equally successful advance of the twin Soviet Far Eastern Fronts. Those pincers would together isolate the entire Japanese Manchurian Army. And there was little the Japanese could do to stop them.
For the first time the Japanese Army faced a ground campaign by a mechanized foe hardened by four years of vicious warfare with Nazi Germany. If the German soldier was the best in the world in 1942, by 1945 it may well have been the Soviet soldier. A great many egos in the Japanese Army high command were facing loss of face, if the war continued much longer. The soldiers in the field were facing death.
The Soviet offensive was violent and smart and merciless, which perfectly matched the personality of its planner and commander, Marshal Aleksandr Vasilevsky:, the man who had saved Moscow in 1941. He had been planning this invasion since late 1944. He called it "Operation August Storm”, and perhaps as a homage to Vaslevsky, American General Schwarzkopf called his 1989 similar operation “Dessert Storm”.
In just 24 days the Red Army would capture all of Manchuria, make amphibious landings in northern Korea and move to capture the southern half of Sakhalin Island. But a large part of this appallingly bad news was withheld from the cabinet and even the "Big Six" by staff officers lower down the command chain,  in part because they feared their superiors would become defeatist, in part to save their own necks, but mostly because the Japanese communications network had been damaged so badly by the Soviet blitzkrieg that the Japanese military staffs did not know a lot of the bad news themselves
The Japanese commander in Manchuria, General Otozo Yamada, was missing for the first 18 hours of the battle, unable to get back to his headquarters. But the battle developed just as Yamada had warned the supreme command that it would; disastrously.
Also on 9 August The British Pacific Fleet (Task Force 37) made up of 10 large and 9 escort aircraft carriers carrying over 2,000 big Corsair fighter/bombers (above) and 106 Avenger torpedo/bombers, 4 battleships, 11 cruisers and 35 destroyers, began launching attacks against Japanese naval targets. 
The British carriers, with their armored flight decks,   proved more effect than their American counterparts which had wooden flight decks. As the U.S. Navy liaison officer on the "HMS Indefatigable" explained, "When a kamikaze hits a US carrier it means 6 months of repair...When a kamikaze hits a Limey carrier it's just a case of 'Sweepers, man your brooms.”
At 10:30 that Wednesday morning, 9 August,  when the full cabinet  met at the request of Foreign Minister Shigenori Togo, the scale of the Manchurian disaster was still unknown, as was the specifics of the British naval addition to the American juggernaut. The primary topic of discussion was the atomic bombing of Hiroshima, and the threat to the Emperor posed by Lt. McDild's (false) information about an American atomic bomb attack on Tokyo.
Army Chief of Staff, General Yoshijiro Umezu (above) began the meeting by insisting the the war must continue until the Americans were forced to meet the army's conditions – no occupation, no disarmament, no war crimes trials, and retention of the Emperor. 
But Baron Hiranuma Kiichiro (above),  past Prime Minister, a ten year member of the Emperor's Privy Council and one of the few politicians with an unquestioned right wing political reputation,  growled, “"Air raids come now every night and day. Do you have the means to defend against the atom bomb? I wonder.”
The Baron then asked if the military could defend Tokyo, should the Americans decide to invade Honshu directly, and strike the capital. The Baron already knew the preparations had fallen behind schedule. General Umezu was forced to admit that factory production of even the suicide weapons was falling further behind, because of the American bombings.  Kiirchiro almost snorted his disdain . "How on earth can you believe it is still possible to continue the war under existing conditions?" 
General Korechika Anami (above), commander of the Imperial Army,  interrupted to save his ally by changing the subject. “I am convinced that the Americans had only one bomb, after all,” he assured the room. It was at this precise moment that a messenger arrived with word of the second atomic bomb attack on Nagasaki. There were now another 70,000 Japanese dead (with another 70,000 injured who would die within days)
In fact the U.S. had enough plutonium for several more bombs. Manhattan Project Commander General Leslie Groves had already reported that another plutonium bomb would be ready for operations on the 17th or 18th of August. At least seven bombs would be available in time for the invasion of Kyushu, now less than a month away.
The current plan was to use the bombs  to "clear the ground" for American invasion forces. But that made sense only if the Americans ignored their own increasing unease with the risk of radiation to the invading American troops. And for the Japanese the plan still made sense - not death not before dishonor, but death as a path to honor.
So the Big Six would have to meet again,  still tied at three to three. This would delay ending the war, but  this time the Emperor must attended and his presence must not be wasted. Like a Kabuki performance, for the generals' benefit, the arguments would have to become characters in the play, representing moral arguments. And the performance would be worth the delay only if the theatrics finally brought an end to the killing.
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