Books: Morgan to Mitchell

THE LORDS OF CREATION—Frederick Lewis Allen—Harper ($3).

On the evening of Dec. 12, 1900, 38-year-old Charles M. Schwab met the elder J. P. Morgan for the first time at a dinner given in Schwab’s honor in Manhattan. Although the newspapers did not report the event, it was destined to be of great historical importance for it led to the formation of U. S. Steel and inaugurated a new period in the history of U. S. business.

Schwab had intended to speak for a few minutes, but talked for an hour, addressing his remarks to the impassive Morgan and calling up a vision of the future opening before the steel industry if it were properly organized and operated. After the dinner Schwab and Morgan talked privately for half an hour, and while the livery-stable keeper’s son made a deep impression on Morgan, they could not freely discuss consolidation of the steel industry, since Schwab was associated with Carnegie, often Morgan’s competitor. Fearing Carnegie’s displeasure, Schwab suggested an “accidental” meeting with Morgan at the Hotel Bellevue in Philadelphia. When he got there he learned that Morgan had caught cold, could not go out, wanted to see Schwab at his home. Schwab committed himself to the extent of going there, heard Morgan’s offer to buy out Carnegie, consulted Mrs. Carnegie as to the most diplomatic way to present the project to the tough, white-bearded Scot who spent half his time in his Highland castle and who had planned for 30 years to retire. She advised a game of golf. On the St. Andrews links in Westchester Schwab described the proposal. When Carnegie agreed the “greatest corporate monster in history” was organized.

Last week Frederick Lewis Allen, author of best-selling Only Yesterday, used the story of U. S. Steel as a starting point for a long (483-page) discussion of financial and corporate expansion in the U. S. between 1900 and 1930. The Lords of Creation concentrates principally on the change from a laissez-faire economy to one dominated by gigantic trusts, but is studded with brief characterizations of the leading financiers of the period and enlivened with colorful items of unfamiliar information. The result is an uneven book, a straightforward narrative of speculative adventures in the sections dealing with the early years, which grows increasingly vague and general when it runs into post-War prosperity and depression. To characterize the early period Author Allen describes the Harriman-Hill battle over the Northern Pacific that created a panic in 1901; the collapse of the trust companies in 1907; the Pujo money investigation and the reform movement. His illustrations of post-War conditions include accounts of the Insull and Van Sweringen holding companies; the careers of Charles Edwin Mitchell, Albert Henry Wiggin, Amadeo Peter Giannini; the history of the banking collapse of 1933.

While The Lords of Creation contains much material that readers of John T. Flynn (God’s Gold), Matthew Josephson (The Robber Barons) and Lewis Corey (The House of Morgan) will find familiar, it assembles this scattered material in readable fashion but employs it to point no novel or daring conclusion.