WEBVTT

NOTE IX. Forth He Goes

1
00:00:00.000 --> 00:00:04.000
Chapter 9. Fourth He Goes.

2
00:00:04.000 --> 00:00:16.000
1. Life in this financial limbo would have exactly suited the placid temperament of our organization but for the distracting activities of Galt.

3
00:00:16.000 --> 00:00:24.000
With Valentine's permission, he took that old vice president's desk in Harbinger's office and began to keep hours.

4
00:00:24.000 --> 00:00:29.000
Such hours! He was always there when Harbinger arrived.

5
00:00:29.000 --> 00:00:34.200
At ten he went to the stock exchange, at three he returned.

6
00:00:34.200 --> 00:00:37.260
He was still there when Harbinger went home.

7
00:00:37.260 --> 00:00:42.160
The scrub women complained of him that he kept them waiting until late at night.

8
00:00:42.160 --> 00:00:46.120
Sometimes for that reason they left the room unswept.

9
00:00:46.120 --> 00:00:52.320
Insatiably he called for records, data, unheard of compilations of statistics.

10
00:00:52.320 --> 00:00:57.840
He wrangled with John Harrier, the treasurer, for hours on end over the nature of assets

11
00:00:57.840 --> 00:00:59.800
and Past Accounting.

12
00:00:59.800 --> 00:01:04.840
Their voices might often be heard in adjacent rooms, pitched in the key of a fish-wife's

13
00:01:04.840 --> 00:01:06.600
quarrel.

14
00:01:06.600 --> 00:01:12.280
Harrier was an autocratic person whose ancient way of accounting had never before been challenged

15
00:01:12.280 --> 00:01:14.960
nor very deeply analyzed.

16
00:01:14.960 --> 00:01:20.480
With so much laxity at the top of the organization, he had been able to do as he pleased.

17
00:01:20.480 --> 00:01:26.800
And being a pessimist, his tendency was to undervalue potential assets, such as lands,

18
00:01:26.800 --> 00:01:30.800
and developed oil and mining rights and deferred claims.

19
00:01:30.800 --> 00:01:38.800
Gradually he wrote them off, a little each year, until in his financial statements they appeared as nominal items.

20
00:01:38.800 --> 00:01:42.800
His judgments were arbitrary and passed without question.

21
00:01:42.800 --> 00:01:45.800
This had been going on for many years.

22
00:01:45.800 --> 00:01:54.800
The result was that a great deal of tangible property, immediately unproductive, yet in fact very valuable, had been almost lost sight of.

23
00:01:54.800 --> 00:02:01.800
The Great Midwestern, like the country, was richer than anybody would believe. And nobody cared.

24
00:02:01.800 --> 00:02:11.800
Live working assets were in general so unprofitable, especially in the case of railroads, that dormant assets were treated with contempt.

25
00:02:11.800 --> 00:02:20.800
Galt valued them. He knew how Harrier had sunk them in his figures and forced him step by step to disclose them.

26
00:02:20.800 --> 00:02:26.480
They are at it again, Harbinger said, coming in one evening to sit for a while in my room,

27
00:02:26.480 --> 00:02:28.480
bringing some papers with him.

28
00:02:28.480 --> 00:02:29.480
Who?

29
00:02:29.480 --> 00:02:30.480
Galt and Harrier.

30
00:02:30.480 --> 00:02:34.160
I can't think for their incessant canter-walling.

31
00:02:34.160 --> 00:02:35.520
How do you get along with him?

32
00:02:35.520 --> 00:02:36.520
I asked.

33
00:02:36.520 --> 00:02:37.520
With Galt?

34
00:02:37.520 --> 00:02:39.480
He makes me very uncomfortable.

35
00:02:39.480 --> 00:02:42.120
There's no concealing anything from him.

36
00:02:42.120 --> 00:02:43.640
Do you still dislike him?

37
00:02:43.640 --> 00:02:45.680
Oh no, that wears off.

38
00:02:45.680 --> 00:02:47.780
I've been watching his mind work.

39
00:02:47.780 --> 00:02:50.000
It's a marvellous piece of mechanism.

40
00:02:50.000 --> 00:02:51.480
He went on with his work.

41
00:02:51.480 --> 00:02:54.960
I know at last what he's doing, he said suddenly.

42
00:02:54.960 --> 00:02:55.960
What?

43
00:02:55.960 --> 00:02:59.280
He's developing a plan of reorganization.

44
00:02:59.280 --> 00:03:00.640
That was true.

45
00:03:00.640 --> 00:03:02.800
I had known it for some time.

46
00:03:02.800 --> 00:03:09.060
He accumulated his data by day in the office and worked it up by night in his room at home.

47
00:03:09.060 --> 00:03:11.500
He showed it to me as it progressed.

48
00:03:11.500 --> 00:03:13.720
There was a good deal of writing in it.

49
00:03:13.720 --> 00:03:16.440
The facts required interpretation.

50
00:03:16.440 --> 00:03:21.280
He was awkward at writing, and I helped him with it, phrasing his ideas.

51
00:03:21.280 --> 00:03:24.380
The financial exposition was one part only.

52
00:03:24.380 --> 00:03:28.480
There was then the physical aspect of the property to be dealt with.

53
00:03:28.480 --> 00:03:32.520
When it came to that, he spent six weeks out on the road.

54
00:03:32.520 --> 00:03:37.800
Three days after he set out on this errand, we began to receive messages by telegraph

55
00:03:37.800 --> 00:03:43.920
from our operating officials, traffic managers, agents and division superintendents to this

56
00:03:43.920 --> 00:03:45.420
effect.

57
00:03:45.420 --> 00:03:48.620
Who is Henry M. Gault?

58
00:03:48.620 --> 00:03:53.580
At Valentine's direction, I answered all of them, saying, Treat Henry M. Gault with

59
00:03:53.580 --> 00:03:55.780
every courtesy.

60
00:03:55.780 --> 00:04:01.540
He went over every mile of the right-of-way, inspected every shop and yard, talked with

61
00:04:01.540 --> 00:04:07.040
the agents and workmasters, and finally scandalized the Department of Traffic by going through

62
00:04:07.040 --> 00:04:11.040
all the contracts in force with large shippers.

63
00:04:11.040 --> 00:04:16.520
He studied traffic conditions throughout the territory, had a look at competing lines,

64
00:04:16.520 --> 00:04:21.440
and conferred with bankers, merchants and Chamber of Commerce presidents about improving

65
00:04:21.440 --> 00:04:24.220
the Great Midwestern service.

66
00:04:24.220 --> 00:04:29.600
He returned with a mass of material, which we worked on every night feverishly, for he

67
00:04:29.600 --> 00:04:32.560
was beginning to be very impatient.

68
00:04:32.560 --> 00:04:37.620
The physical aspect of the property, having been treated from an original point of view,

69
00:04:37.620 --> 00:04:41.980
There followed an illuminating discussion of business policy.

70
00:04:41.980 --> 00:04:47.380
Goodwill had been leaving the Great Midwestern, owing to the unaccommodating nature of its

71
00:04:47.380 --> 00:04:48.540
service.

72
00:04:48.540 --> 00:04:54.180
This fact he emphasized brutally and then outlined the means whereby the road's former

73
00:04:54.180 --> 00:04:57.620
prestige might be regained.

74
00:04:57.620 --> 00:05:01.940
Never had a railroad been so intelligently surveyed before.

75
00:05:01.940 --> 00:05:07.360
The work as it lay finished one midnight on Galt's table represented an incredible amount

76
00:05:07.360 --> 00:05:14.920
of Labor. More than that, it represented creative imagination in three areas, finance, physical

77
00:05:14.920 --> 00:05:20.880
development and business policy. The financial thesis was that the Great Midwestern should

78
00:05:20.880 --> 00:05:27.640
be reorganized without assessing the stockholders in the usual way. All that was necessary was

79
00:05:27.640 --> 00:05:34.880
to sell them new securities on the basis of dormant assets. This was a new idea.

80
00:05:34.880 --> 00:05:37.640
Have you done all this in collaboration with the bankers?

81
00:05:37.640 --> 00:05:38.840
I asked him.

82
00:05:38.840 --> 00:05:40.240
No, he said.

83
00:05:40.240 --> 00:05:42.240
They have a plan of their own.

84
00:05:42.240 --> 00:05:46.720
My next job is to make them accept this in place of theirs.

85
00:05:46.720 --> 00:05:50.280
That's why I've been in such a sweat to get it done.

86
00:05:50.280 --> 00:05:52.600
What inducement can you offer them?

87
00:05:52.600 --> 00:05:54.400
Mine is the better plan, he said.

88
00:05:54.400 --> 00:05:56.600
It stands on its merits.

89
00:05:56.600 --> 00:05:58.880
What will you get out of it, I asked.

90
00:05:58.880 --> 00:06:01.040
He looked very wise.

91
00:06:01.040 --> 00:06:03.640
That's the crow in the pie, Coxie.

92
00:06:03.640 --> 00:06:08.440
He got up, stretched, walked about a bit, and stood in front of me, saying,

93
00:06:08.440 --> 00:06:10.720
I'll get a place on the board of directors.

94
00:06:10.720 --> 00:06:13.840
I'll be one of ten men in a boardroom.

95
00:06:13.840 --> 00:06:17.480
Everything else follows from that.

96
00:06:17.480 --> 00:06:19.200
Two

97
00:06:19.200 --> 00:06:24.560
A railroad has its own bankers, just as you have your own dentist or doctor.

98
00:06:24.560 --> 00:06:28.080
They sit on the board of directors as financial experts.

99
00:06:28.080 --> 00:06:30.800
They carry out the company's fiscal policies.

100
00:06:30.800 --> 00:06:33.960
They sell its securities to the public for a commission.

101
00:06:33.960 --> 00:06:39.260
They lend it money while it is solvent, and when it is insolvent, they constitute themselves

102
00:06:39.260 --> 00:06:45.140
a protective committee for the security holders, and get all the stocks and bonds deposited

103
00:06:45.140 --> 00:06:48.040
in their hands under a trust agreement.

104
00:06:48.040 --> 00:06:54.000
Then, in due time, they announce a plan of reorganization.

105
00:06:54.000 --> 00:06:57.560
Mordecai and Company were the Great Midwestern's bankers.

106
00:06:57.560 --> 00:06:59.560
The Theory of Money and Credit

107
00:07:27.560 --> 00:07:56.620
The profession of dynamic man is arms. It has never been otherwise. Only the rules and

108
00:07:56.620 --> 00:08:02.260
Blood Weapons Change, He Makes a Tilting Field of Business, The Blood Weapon is Put

109
00:08:02.260 --> 00:08:09.260
Away, Killing is Taboo, But the Struggle is There, If You Look, Essentially Unchanged,

110
00:08:09.260 --> 00:08:12.060
Men are the Same as Always.

111
00:08:12.060 --> 00:08:18.500
Wall Street is a modern jousting place, the gates stand open, anyone may compete, there

112
00:08:18.500 --> 00:08:26.300
is no cast, the prizes are unlimited, the tournament is continuous, capital is not essential,

113
00:08:26.300 --> 00:08:31.780
One may borrow that, as the stranger knight of ancient time, bringing only his skill and

114
00:08:31.780 --> 00:08:37.660
daring, might have borrowed lance, horse, and armor for a trial of prowess.

115
00:08:37.660 --> 00:08:44.580
To this field of combat you must bring courage, subtlety, nerve, endurance of mind, and swift

116
00:08:44.580 --> 00:08:46.580
imagination.

117
00:08:46.580 --> 00:08:52.940
Given these qualities, then to gain more wealth and power than any feudal lord, you need only

118
00:08:52.940 --> 00:08:57.580
Only one inch more than the next longest lance of thought.

119
00:08:57.580 --> 00:09:02.340
You have only to outreach the vision of the champions to unhorse them.

120
00:09:02.340 --> 00:09:05.620
There is no mercy for the fallen, no more than ever.

121
00:09:05.620 --> 00:09:07.640
The new hero is acclaimed.

122
00:09:07.640 --> 00:09:12.780
He may build him a castle on any hill, and with his wealth command the labor of tens

123
00:09:12.780 --> 00:09:14.240
of thousands.

124
00:09:14.240 --> 00:09:19.540
But he must still defend his own against all comers in the marketplace.

125
00:09:19.540 --> 00:09:23.080
In time he will meet one greater than himself.

126
00:09:23.080 --> 00:09:28.280
He may have the consolation of knowing, if it is a consolation, that defeat is never

127
00:09:28.280 --> 00:09:31.480
fatal or seldom ever.

128
00:09:31.480 --> 00:09:34.340
Now through these gates went Galt.

129
00:09:34.340 --> 00:09:39.180
He had a vision of the future longer than the lance of any knight defending.

130
00:09:39.180 --> 00:09:41.320
He needed horse and armor.

131
00:09:41.320 --> 00:09:44.740
I did not see him again that day.

132
00:09:44.740 --> 00:09:46.740
3.

133
00:09:46.740 --> 00:09:49.140
In the evening I went to the house.

134
00:09:49.140 --> 00:09:50.140
Natalie met me.

135
00:09:50.140 --> 00:09:52.140
He is in bed, she said.

136
00:09:52.140 --> 00:09:53.500
Is he ill?

137
00:09:53.500 --> 00:09:55.740
He looked very tired and ate no dinner.

138
00:09:55.740 --> 00:10:00.560
I was to tell you if you came that he had to get a big sleep on account of something

139
00:10:00.560 --> 00:10:02.820
that will happen tomorrow.

140
00:10:02.820 --> 00:10:04.940
I was holding my hat.

141
00:10:04.940 --> 00:10:05.940
Natalie looked at it.

142
00:10:05.940 --> 00:10:09.820
My beautiful sister is not at home, she said.

143
00:10:09.820 --> 00:10:11.980
Tell her I was desolate.

144
00:10:11.980 --> 00:10:16.020
And that you did not ask for her, she suggested slyly.

145
00:10:16.020 --> 00:10:19.220
Now Natalie, you are teasing me.

146
00:10:19.220 --> 00:10:24.060
Mama is out, grandma's gone to bed, there's nobody to entertain you, she said, shaking

147
00:10:24.060 --> 00:10:25.460
her head.

148
00:10:25.460 --> 00:10:30.820
What a dreary state of things, I said, laughing at her and putting down my hat.

149
00:10:30.820 --> 00:10:35.820
She went ahead of me into the parlor, arranged a heap of pillows at one end of the sofa,

150
00:10:35.820 --> 00:10:42.980
saying, there, and sat herself in a small straight chair some distance away.

151
00:10:42.980 --> 00:10:47.840
Living on eighteen is an age between maidenhood and womanhood.

152
00:10:47.840 --> 00:10:53.440
Innocence and wisdom have the same naive guise and change parts so fast that you cannot be

153
00:10:53.440 --> 00:10:55.760
sure which one is acting.

154
00:10:55.760 --> 00:10:58.240
The girl herself is not sure.

155
00:10:58.240 --> 00:11:00.160
She doesn't stop to think.

156
00:11:00.160 --> 00:11:04.320
It is a charming masquerade of two mysterious forces.

157
00:11:04.320 --> 00:11:07.620
The part of innocence is to protect and conceal her.

158
00:11:07.620 --> 00:11:12.100
The part of wisdom is to betray and reveal her.

159
00:11:12.100 --> 00:11:15.260
I wish I were a man, she sighed.

160
00:11:15.260 --> 00:11:17.020
Every girl says that once.

161
00:11:17.020 --> 00:11:18.020
Why do you wish it?

162
00:11:18.020 --> 00:11:19.020
I asked.

163
00:11:19.020 --> 00:11:20.740
But it's so, she said.

164
00:11:20.740 --> 00:11:21.900
They know so much.

165
00:11:21.900 --> 00:11:24.280
They can do so many things.

166
00:11:24.280 --> 00:11:27.160
What does a man know that a woman doesn't?

167
00:11:27.160 --> 00:11:30.580
If I were a man, she said, I'd be able to help father.

168
00:11:30.580 --> 00:11:34.420
I'd understand figures and charts and all those things he works with.

169
00:11:34.420 --> 00:11:36.220
They make my silly headache.

170
00:11:36.220 --> 00:11:37.580
I'd study finance.

171
00:11:37.580 --> 00:11:39.180
What is it like?

172
00:11:39.180 --> 00:11:40.700
What is finance like?

173
00:11:40.700 --> 00:11:41.700
Yes.

174
00:11:41.700 --> 00:11:44.740
Do you think I might understand it a little?

175
00:11:44.740 --> 00:11:51.100
For an hour or more we talked finance, that is, I talked and she listened, saying, yes,

176
00:11:51.100 --> 00:11:54.820
and oh, and bringing her chair closer.

177
00:11:54.820 --> 00:11:57.260
She made a very pretty picture of attention.

178
00:11:57.260 --> 00:12:00.020
I'm sure she didn't understand a word of it.

179
00:12:00.020 --> 00:12:05.260
Then she began to ask me questions about her father, what his office was like, how he dealt

180
00:12:05.260 --> 00:12:10.740
with Wall Street people, what he did on the stock exchange, and so on.

181
00:12:10.740 --> 00:12:15.960
Asked you, she asked, when I rose to go, I'm afraid you haven't been entertained at all.

182
00:12:15.960 --> 00:12:18.060
I love to listen.

183
00:12:18.060 --> 00:12:21.260
I just now remember I haven't had any dinner, I said.

184
00:12:21.260 --> 00:12:24.420
I stopped late at the office and came directly here.

185
00:12:24.420 --> 00:12:26.500
It's past ten o'clock.

186
00:12:26.500 --> 00:12:28.260
Dear me, why didn't you tell me?

187
00:12:28.260 --> 00:12:29.540
I'll get you something.

188
00:12:29.540 --> 00:12:31.020
You didn't know I could cook.

189
00:12:31.020 --> 00:12:33.020
Come on.

190
00:12:33.020 --> 00:12:37.180
Without waiting for yes or no, she scurried off in the direction of the kitchen.

191
00:12:37.180 --> 00:12:42.220
I followed to call her back, but when I had reached the dining room she was out of sight,

192
00:12:42.220 --> 00:12:44.900
the pantry door swinging behind her.

193
00:12:44.900 --> 00:12:50.060
I returned to the parlor and waited, thinking she would report what there was to eat.

194
00:12:50.060 --> 00:12:53.580
Then I could make my excuses and depart.

195
00:12:53.580 --> 00:12:55.980
She did not return.

196
00:12:55.980 --> 00:13:01.180
Presently I began to feel embarrassed, as much for her as for myself, also a little

197
00:13:01.180 --> 00:13:02.180
nettled.

198
00:13:02.180 --> 00:13:04.660
However, I couldn't disappoint her now.

199
00:13:04.660 --> 00:13:09.660
The Theory of Money and Credit

200
00:14:04.660 --> 00:14:06.660
The Theory of Money and Credit

201
00:14:34.660 --> 00:14:37.100
What's that for?

202
00:14:37.100 --> 00:14:42.420
I'm thinking, she said, what my sister would say if she saw us now.

203
00:14:42.420 --> 00:14:47.980
As I walked home, I could not help contrasting her with Vera, who never, even at Natalie's

204
00:14:47.980 --> 00:14:51.260
age, would have thought of doing a thing like that.

205
00:14:51.260 --> 00:14:52.260
Why?

206
00:14:52.260 --> 00:14:53.900
Yes, why?

207
00:14:53.900 --> 00:14:57.940
Well, because she had not that way with a man.

208
00:14:57.940 --> 00:15:01.120
Natalie was born to get what she wanted through men.

209
00:15:01.120 --> 00:15:05.700
She fed them, she fed their stomachs with food and their egos with adoration.

210
00:15:05.700 --> 00:15:08.520
She liked doing it, for she liked men.

211
00:15:08.520 --> 00:15:13.040
She already knew more about their simplicities than Vera would ever learn.

212
00:15:13.040 --> 00:15:15.400
She knew it all instinctively.

213
00:15:15.400 --> 00:15:19.320
And how lovely she was in that apron.

214
00:15:19.320 --> 00:15:21.040
4.

215
00:15:21.040 --> 00:15:26.160
Late the next afternoon he appeared at my desk, sat down, fixed me with a stare, and

216
00:15:26.160 --> 00:15:29.760
began to whistle Yankee Doodle out of tune.

217
00:15:29.760 --> 00:15:30.760
Did they take your plan?

218
00:15:30.760 --> 00:15:36.360
When I asked him, he went on whistling. I couldn't guess what had happened. His expression

219
00:15:36.360 --> 00:15:44.040
was unreadable. Did they? I asked again. He stopped for breath. Spit on your hands, Coxie,

220
00:15:44.040 --> 00:15:49.000
he said, as if I were at a distance and needed some encouragement. We've got her by the

221
00:15:49.000 --> 00:15:56.240
tail, by the tail, tail, tail. We'll tie a knot in the end of it, and then we're off.

222
00:15:56.240 --> 00:15:58.380
He never told me how he did it.

223
00:15:58.380 --> 00:16:01.140
He had no vanity of reminiscence.

224
00:16:01.140 --> 00:16:06.620
Long afterward I got it from a junior partner of the firm of Mordecai and Company.

225
00:16:06.620 --> 00:16:08.680
They hardly knew him by sight.

226
00:16:08.680 --> 00:16:13.120
He appeared in their office on that hot summer morning and said simply that he wished to

227
00:16:13.120 --> 00:16:15.080
talk Great Midwestern.

228
00:16:15.080 --> 00:16:18.700
He would see nobody but Mordecai himself.

229
00:16:18.700 --> 00:16:23.840
At midday they were still talking, and lunch was brought to Mordecai's room.

230
00:16:23.840 --> 00:16:28.820
One by one the junior members were called in until they were all present.

231
00:16:28.820 --> 00:16:34.200
Galt amazed them with his knowledge of the property, its situation and possibilities,

232
00:16:34.200 --> 00:16:37.980
even more with his acute understanding of its finances.

233
00:16:37.980 --> 00:16:41.200
He gave them information on matters they had never heard of.

234
00:16:41.200 --> 00:16:48.000
He gave them original ideas with such frankness and unreserve that at one point Mordecai interrupted.

235
00:16:48.000 --> 00:16:54.960
We cannot forget what you say, Mr. Galt. It is so important we might use it. There is

236
00:16:54.960 --> 00:17:02.480
no bargain yet. We are not here angels. I can't help that, said Galt. To sell a tune,

237
00:17:02.480 --> 00:17:10.480
you have to play it. And he went on. When Mordecai spoke again, the case was lost.

238
00:17:10.480 --> 00:17:17.800
For us it is not, he said. For us it is not. We are bankers. To these heights of imagination

239
00:17:17.800 --> 00:17:28.240
In the doorway, Galt turned and faced them. No one else had moved.

240
00:17:28.240 --> 00:17:33.960
I'm tired, he said. I need some sleep. I'll come tomorrow.

241
00:17:33.960 --> 00:17:39.440
The scene was repeated the next day. Galt talking, the bankers listening, Mordecai lying

242
00:17:39.440 --> 00:17:44.960
back in his chair, gazing at the ceiling, tapping the ends of his fingers together,

243
00:17:44.960 --> 00:17:56.280
What is it you yourself you want, Mr. Galt, he asked, without moving.

244
00:17:56.280 --> 00:18:00.040
It was Galt's way, when he was winning, to press his luck.

245
00:18:00.040 --> 00:18:02.600
He wanted a place on the board of directors.

246
00:18:02.600 --> 00:18:04.720
But he demanded more.

247
00:18:04.720 --> 00:18:08.920
I want to be chairman of the board, he said.

248
00:18:08.920 --> 00:18:12.400
It would be strange, said Mordecai pensively.

249
00:18:12.400 --> 00:18:14.200
Nobody would understand it.

250
00:18:14.200 --> 00:18:22.760
Who is that Mr. Galt? Why is he made chairman? So the people would talk. Of the old directors,

251
00:18:22.760 --> 00:18:29.480
who would vote for that Mr. Galt? Gates and Valentine will vote for me, said Galt.

252
00:18:29.480 --> 00:18:34.520
You have asked them? I have asked Gates, said Galt. I am sure of Valentine.

253
00:18:36.040 --> 00:18:42.360
Another way of Galt's was to stop at the peak of his argument and wait. When the other man in his

254
00:18:42.360 --> 00:18:47.360
If Mordecai's mind is coming over to your side, a word too much will often stop him.

255
00:18:47.360 --> 00:18:54.360
Galt knew he was winning. There was a long silence. They began to wonder if Mordecai was asleep.

256
00:18:54.360 --> 00:18:58.360
He was a man of few but surprising contradictions.

257
00:18:58.360 --> 00:19:07.360
Conservative, cautious, axiomatic, he had on the other side great courage of mind and a latent capacity for daring.

258
00:19:07.360 --> 00:19:13.480
He distrusted intuition as a faculty, yet on rare occasions he astonished his associates

259
00:19:13.480 --> 00:19:19.960
by arriving most unexpectedly at an intuitive conclusion, knowing it to be such, and acting

260
00:19:19.960 --> 00:19:23.320
upon it with fatalistic intensity.

261
00:19:23.320 --> 00:19:27.000
On those occasions he was never wrong.

262
00:19:27.000 --> 00:19:31.800
Now he sat up slowly and began to toy with a jeweled paper knife.

263
00:19:31.800 --> 00:19:49.800
Nobody will understand it, Mr. Galt. Nobody will understand it. We accept your plan. We promise all our influence to use that you will be made Chairman of the Board on one condition. You will resign if we ask it immediately.

264
00:19:49.800 --> 00:20:04.800
5. In September, the plan was brought out. Though it caused a good deal of dubious comment, the verdict of general opinion was ultimately favorable. The security-holders liked it because they were not assessed in the order of the General Assembly.

265
00:20:04.800 --> 00:20:15.800
5. In September, the plan was brought out. Though it caused a good deal of dubious comment, the verdict of general opinion was ultimately favorable.

266
00:20:15.800 --> 00:20:20.800
The security holders liked it because they were not assessed in the ordinary way.

267
00:20:20.800 --> 00:20:26.800
They received, instead, the privilege, so-called, of buying new securities.

268
00:20:26.800 --> 00:20:32.800
When all arrangements were completed, the assets of the old Great Midwestern Railroad Company,

269
00:20:32.800 --> 00:20:38.800
meaning the railroad itself and all its possessions and appurtenances, were put up at auction.

270
00:20:38.800 --> 00:20:43.800
Mordecai and company, acting as trustees, were the only bidders.

271
00:20:43.800 --> 00:20:53.800
They delivered the assets to the new Great Midwestern Railway Company, which had been previously incorporated under the laws of New Jersey.

272
00:20:53.800 --> 00:21:12.800
Afterward, there was a stockholders meeting in Jersey City, in one of those corporation tenements where rooms are hired in rotation by corporations that never live in them but come once a year for an hour or two to transact some formal business and thereby satisfy the fiction of legal residence.

273
00:21:12.800 --> 00:21:18.120
A stockholders' meeting is itself a fiction.

274
00:21:18.120 --> 00:21:21.240
The stockholders are present by proxy.

275
00:21:21.240 --> 00:21:23.800
Clerks bring the proxies in suitcases.

276
00:21:23.800 --> 00:21:28.640
They are counted and voted in the name of the stockholders under previous instructions.

277
00:21:28.640 --> 00:21:31.800
Thus, directors are elected.

278
00:21:31.800 --> 00:21:35.760
Mordecai and company held six-tenths of the proxies.

279
00:21:35.760 --> 00:21:41.080
Horace Potter, representing himself and the oil crowd whose investment in the old Great

280
00:22:11.080 --> 00:22:16.280
For the first time since their inglorious exit through Harbinger's office 11 months

281
00:22:16.280 --> 00:22:21.400
before, Valentine was unanimously re-elected president.

282
00:22:21.400 --> 00:22:22.880
There was a pause.

283
00:22:22.880 --> 00:22:29.360
I propose Mr. Gauld for Chairman of Zeebord, Lisbeth Mordecai.

284
00:22:29.360 --> 00:22:31.700
It had all been arranged beforehand.

285
00:22:31.700 --> 00:22:33.880
There was no doubt of the outcome.

286
00:22:33.880 --> 00:22:37.800
Yet there was an air of constraint about taking the formal step.

287
00:22:37.800 --> 00:22:42.400
Evidently, in the background, there had been a struggle of forces.

288
00:22:42.400 --> 00:22:45.400
Potter said, second the nomination.

289
00:22:45.400 --> 00:22:47.600
The president called for the vote.

290
00:22:47.600 --> 00:22:50.400
Four were silent, including Galt.

291
00:22:50.400 --> 00:22:52.800
Five voted aye.

292
00:22:52.800 --> 00:22:56.600
Valentine nodded his head, and the result was recorded.

293
00:22:56.600 --> 00:23:00.100
Chairman of the board, Henry M. Galt.

294
00:23:00.100 --> 00:23:03.400
Meanwhile, the traffic manager and his three assistants,

295
00:23:03.400 --> 00:23:06.200
who had been summoned from Chicago for a conference,

296
00:23:06.200 --> 00:23:08.840
were waiting in Harbinger's office.

297
00:23:08.840 --> 00:23:11.860
Galt walked directly there from the boardroom,

298
00:23:11.860 --> 00:23:15.080
sat on Harbinger's desk with his feet in the chair,

299
00:23:15.080 --> 00:23:19.360
waved all introductions and said, now for business.

300
00:23:19.360 --> 00:23:23.000
Hereafter, all contracts with shippers and all agreements

301
00:23:23.000 --> 00:23:25.200
with the traffic managers of other roads

302
00:23:25.200 --> 00:23:29.660
will be sent to this office for my approval and signature.

303
00:23:29.660 --> 00:23:33.000
They will not be valid otherwise.

304
00:23:33.000 --> 00:23:39.120
The traffic manager was a florid, contemptuous man, who wore costly Chicago clothes and carried

305
00:23:39.120 --> 00:23:43.460
a watch in each waistcoat pocket, very far apart.

306
00:23:43.460 --> 00:23:48.580
He was one of a ring of traffic managers who waxed fat and arrogant in the exercise of

307
00:23:48.580 --> 00:23:53.400
a power that nobody dared or knew how to wrest from them.

308
00:23:53.400 --> 00:23:55.440
They sold favors to shippers.

309
00:23:55.440 --> 00:24:01.100
They sold railroad stocks for a fall in Wall Street, and then got up ruinous rate wars

310
00:24:01.100 --> 00:24:31.100
At Galt's speech, the traffic

311
00:24:31.100 --> 00:24:44.100
The traffic manager crossed his legs with amazement, dropped his arms, slid down in his chair, bowed his neck, and assumed the look of an incredulous bull showing the white under his eyes.

312
00:24:44.100 --> 00:24:47.100
And who the hell are you? he asked.

313
00:24:47.100 --> 00:24:49.100
Me? said Galt.

314
00:24:49.100 --> 00:24:51.100
I'm the driver.

315
00:24:51.100 --> 00:24:54.100
We'll see, said the traffic manager.

316
00:24:54.100 --> 00:25:00.100
He rose, overturning his chair, and made for the door, meaning, of course, to see the president.

317
00:25:00.100 --> 00:25:04.740
You'd better wait a minute, said Galt. I'm not through yet. He waited.

318
00:25:05.860 --> 00:25:12.420
Then Galt, addressing the assistants, outlined a new policy. What they were to work for was

319
00:25:12.420 --> 00:25:18.500
through freight, passing from one end of the system to the other. What they were to avoid was

320
00:25:18.500 --> 00:25:24.660
anything they wouldn't like a railroad to do to them. What they were to believe in was a gang

321
00:25:24.660 --> 00:25:37.660
Getting down on the floor he advanced slowly with a stealthy step at the traffic manager, who began to quail.

322
00:25:37.660 --> 00:25:44.660
You choose whether to resign or be fired, said Galt. The first assistant will take your place.

323
00:25:44.660 --> 00:25:51.660
He added something in a lower tone that no one else could hear, then stood looking at him fixedly.

324
00:25:51.660 --> 00:25:58.660
The traffic manager started, mopped the back of his neck, wavered, and stood quite still.

325
00:25:58.660 --> 00:26:04.660
Well, it's damned high time, he said at last, by way of mentioning a basic fact.

326
00:26:04.660 --> 00:26:08.660
With that, he sat down and wrote his resignation.

327
00:26:08.660 --> 00:26:13.660
This incident was an omen. Unconsciously, Galt worked on the principle

328
00:26:13.660 --> 00:26:17.660
that once a thing has happened, it cannot unhappen.

329
00:26:17.660 --> 00:26:22.300
The fact of its having happened is original and irrevocable.

330
00:26:22.300 --> 00:26:27.020
Every other fact in the universe must adjust itself to that one.

331
00:26:27.020 --> 00:26:29.540
Something else may happen the next instant.

332
00:26:29.540 --> 00:26:32.660
That is a new happening again.

333
00:26:32.660 --> 00:26:37.580
Mr. Valentine was violently agitated by the traffic manager's dismissal.

334
00:26:37.580 --> 00:26:40.580
If he had been consulted, he would have made an issue of it.

335
00:26:40.580 --> 00:26:41.780
But there it was.

336
00:26:41.780 --> 00:26:43.340
It had happened.

337
00:26:43.340 --> 00:26:45.940
The fact created a situation.

338
00:26:45.940 --> 00:26:51.340
He might refuse to accept the situation, but he could not extinguish the fact.

339
00:26:51.340 --> 00:26:54.180
He fumed and let it pass.

340
00:26:54.180 --> 00:26:57.260
Nothing was ever the same again.

341
00:26:57.260 --> 00:26:59.340
Galt consulted nobody.

342
00:26:59.340 --> 00:27:04.140
He turned from the traffic man to Harbinger and ordered that the pay of the whole executive

343
00:27:04.140 --> 00:27:08.140
staff from the secretary down be doubled.

344
00:27:08.140 --> 00:27:13.020
Then he put Harbinger out, took the whole of the room for himself, painted the word

345
00:27:13.020 --> 00:27:19.620
The Great Midwestern was managed from his desk.

346
00:27:19.620 --> 00:27:21.920
There was never a moment's doubt about it.

347
00:27:21.920 --> 00:27:24.600
There was no time to debate his authority.

348
00:27:24.600 --> 00:27:29.240
It took all of everybody's time to keep up with what was happening.

349
00:27:29.240 --> 00:27:35.860
He recast the operating department by telegraph in one hour, according to a plan already matured

350
00:27:35.860 --> 00:27:37.500
in his mind.

351
00:27:37.500 --> 00:27:43.340
He changed the accounting system radically and, much to everyone's surprise, John Harrier

352
00:27:43.340 --> 00:27:47.340
accepted the change with enthusiasm.

353
00:27:47.340 --> 00:27:52.680
Having made a flying trip over the road, he sent a telegram ahead of him calling a special

354
00:27:52.680 --> 00:27:55.100
meeting of the board of directors.

355
00:27:55.100 --> 00:27:57.580
It convened at 10 o'clock.

356
00:27:57.580 --> 00:28:03.340
Galt came directly from the train, stained, unshaven and a little weary, until he began

357
00:28:03.340 --> 00:28:05.260
to talk.

358
00:28:05.260 --> 00:28:12.640
What he proposed was that $50 million be raised at once and spent for new engines, cars, rails

359
00:28:12.640 --> 00:28:15.300
and road improvements.

360
00:28:15.300 --> 00:28:18.180
Mordecai alone was prepared for this.

361
00:28:18.180 --> 00:28:21.220
All the others were daft with astonishment.

362
00:28:21.220 --> 00:28:28.060
A railroad only a few days out of bankruptcy to find and spend that sum for improvements?

363
00:28:28.060 --> 00:28:30.280
It was preposterous.

364
00:28:30.280 --> 00:28:35.800
Not only was the whole board against him, save Mordecai, it was hostile and struck with

365
00:28:35.800 --> 00:28:37.360
foreboding.

366
00:28:37.360 --> 00:28:41.800
As Galt rose to make his argument, I remembered what he had twice said.

367
00:28:41.800 --> 00:28:46.320
I shall be one of ten men in a boardroom.

368
00:28:46.320 --> 00:28:49.800
Everything else follows from that.

369
00:28:49.800 --> 00:28:51.760
6.

370
00:28:51.760 --> 00:28:57.320
This was the first true exhibition of his power to move men's minds, a power which

371
00:28:57.320 --> 00:29:02.200
which nobody understood, which he did not himself understand.

372
00:29:02.200 --> 00:29:05.600
Perhaps it was not their minds he moved.

373
00:29:05.600 --> 00:29:10.680
Men of strong will often turned from their convictions and voted with him or for what

374
00:29:10.680 --> 00:29:15.940
he wanted, who afterward, having recovered their own opinions, were unable to say why

375
00:29:15.940 --> 00:29:18.300
they had acted that way.

376
00:29:18.300 --> 00:29:19.900
He was not eloquent.

377
00:29:19.900 --> 00:29:23.940
When he was excited, his voice became shrill and irritating.

378
00:29:23.940 --> 00:29:30.300
He had no felicity of speech and often lost the grammar of tenses, cases and pronouns.

379
00:29:30.300 --> 00:29:33.180
The reasoning was always clear.

380
00:29:33.180 --> 00:29:39.420
He molded an argument in the form of a wedge and then hit it a sledgehammer blow.

381
00:29:39.420 --> 00:29:42.760
But it was not the argument alone that did it.

382
00:29:42.760 --> 00:29:48.080
As time went on, he more and more dispensed with argument and brought the result to pass

383
00:29:48.080 --> 00:29:54.880
Man's directly, as a hypnotist with a well-trained subject, induces the trance without preparation,

384
00:29:54.880 --> 00:29:58.140
seemingly by an act of mere intention.

385
00:29:58.140 --> 00:30:03.400
It was a power that increased with use until it was like an elemental force, and acted

386
00:30:03.400 --> 00:30:08.900
at a distance, so that he had only to send an agent with word that this or that should

387
00:30:08.900 --> 00:30:12.900
be done, and men did it, helplessly.

388
00:30:12.900 --> 00:30:18.660
You may say, of course, that all such later phenomena were owing to a habit of submission,

389
00:30:18.660 --> 00:30:22.020
men having accepted the tyranny of his will.

390
00:30:22.020 --> 00:30:27.860
Only that would not account for the rise of his power from nothing, would it?

391
00:30:27.860 --> 00:30:32.380
In this first case he had back of him no prestige of success.

392
00:30:32.380 --> 00:30:37.660
He was still unknown and distrusted by a majority of the ten directors who sat at the board

393
00:30:37.660 --> 00:30:38.820
table.

394
00:30:38.820 --> 00:30:41.620
And they were not men accustomed to be led.

395
00:30:41.620 --> 00:30:44.320
They Were Themselves Leaders

396
00:30:44.320 --> 00:30:50.260
In all Wall Street, it would have been impossible to find a more powerful, self-confident group.

397
00:30:50.260 --> 00:30:57.000
Cold, calculating, unsentimental in business, their faces all cruelly scarred with the marks

398
00:30:57.000 --> 00:31:00.160
of success terrifically achieved.

399
00:31:00.160 --> 00:31:03.860
Yet as he talked, their chemistries changed.

400
00:31:03.860 --> 00:31:08.060
The first visible reaction was one of bothered surprise.

401
00:31:08.060 --> 00:31:10.900
This was followed by efforts of resistance.

402
00:31:10.900 --> 00:31:14.760
The last phase was one of fascination.

403
00:31:14.760 --> 00:31:16.380
His reasons were these.

404
00:31:16.380 --> 00:31:18.940
A flood was about to rise.

405
00:31:18.940 --> 00:31:21.420
He adduced evidence on that point.

406
00:31:21.420 --> 00:31:25.980
Money, materials and labor were plenty and cheap.

407
00:31:25.980 --> 00:31:32.100
Never again would it be possible to increase the railroad's capacity at a cost so low,

408
00:31:32.100 --> 00:31:37.700
and a railroad that made itself ready to receive the flood would reap a rich harvest.

409
00:31:37.700 --> 00:31:43.160
Finally, the spending of 50 million dollars in this way would give business the impulse

410
00:31:43.160 --> 00:31:49.760
it was waiting for, the little push that sends a great vessel down the ways into the water.

411
00:31:49.760 --> 00:31:53.600
The moment was rare and propitious.

412
00:31:53.600 --> 00:31:59.000
Is it true, asked Mr. Valentine, that the chairman on his own responsibility, without

413
00:31:59.000 --> 00:32:05.000
consulting the president or the board of directors, has already placed contracts for engines,

414
00:32:05.000 --> 00:32:11.000
cars, rails and construction work, before the money has been voted for that purpose,

415
00:32:11.000 --> 00:32:17.000
before anybody knows whether it can be raised or not, I have heard so.

416
00:32:17.000 --> 00:32:19.500
Everyone was startled by the question.

417
00:32:19.500 --> 00:32:21.500
Galt was not expecting it.

418
00:32:21.500 --> 00:32:24.500
That is true, he said, and waited.

419
00:32:24.500 --> 00:32:29.000
So we are committed to this expenditure whether we approve it or not?

420
00:32:29.000 --> 00:32:32.500
That's the predicament, said Galt recklessly.

421
00:32:32.500 --> 00:32:37.420
Valentine, wholly deceived by his manner, came heavily on.

422
00:32:37.420 --> 00:32:43.700
Have you any idea what it will cost us to get out of these contracts, to cancel them?

423
00:32:43.700 --> 00:32:48.820
The construction contracts, Galt said very slowly, are subject to cancellation without

424
00:32:48.820 --> 00:32:51.260
penalty until this midnight.

425
00:32:51.260 --> 00:32:55.740
The contracts for engines, cars and rails cannot be cancelled.

426
00:32:55.740 --> 00:32:58.740
I've baked this pie for the Great Midwestern.

427
00:32:58.740 --> 00:33:04.160
If it doesn't want it, I'll give the company's treasurer my check for $100,000 and eat it

428
00:33:04.160 --> 00:33:06.160
myself.

429
00:33:06.160 --> 00:33:07.160
What do you mean?

430
00:33:07.160 --> 00:33:08.820
Horace Potter asked.

431
00:33:08.820 --> 00:33:14.400
I mean that in consideration of placing the orders when and as I did on the equipment

432
00:33:14.400 --> 00:33:19.680
maker's empty stomach, I got a special discount of 10 percent.

433
00:33:19.680 --> 00:33:25.200
The idea was that the news of our buying as it got around would start a general buying

434
00:33:25.200 --> 00:33:26.380
movement.

435
00:33:26.380 --> 00:33:27.860
That has happened.

436
00:33:27.860 --> 00:33:32.260
Other roads have placed orders behind ours at full prices.

437
00:33:32.260 --> 00:33:34.740
We started a stampede.

438
00:33:34.740 --> 00:33:38.420
Nobody has been buying equipment for two or three years.

439
00:33:38.420 --> 00:33:40.160
Everybody needs some.

440
00:33:40.160 --> 00:33:46.380
These contracts can be sold today for at least $100,000.

441
00:33:46.380 --> 00:33:51.060
Can we sell 50 millions of bonds? asked Potter, looking at Mordecai.

442
00:33:51.060 --> 00:33:55.300
Vi vil garantie to sell them, said Mordecai.

443
00:33:55.300 --> 00:33:57.140
Mr. Galt is right.

444
00:33:57.140 --> 00:34:00.620
If we reap, we must sow.

445
00:34:00.620 --> 00:34:06.280
With no further discussion, they voted with Galt, and the feud between Valentine and Galt

446
00:34:06.280 --> 00:34:09.080
was openly established.

447
00:34:09.080 --> 00:34:12.440
We were torn by the dilemma of allegiance.

448
00:34:12.440 --> 00:34:14.440
Everyone was fond of Valentine.

449
00:34:14.440 --> 00:34:20.080
One could not help liking him, and his position was desperately uncomfortable.

450
00:34:20.080 --> 00:34:25.680
Galt had reduced him to a mere figurehead, not intentionally, perhaps, not by any overt

451
00:34:25.680 --> 00:34:33.200
Act of Hostility certainly, but as an inevitable consequence of his ruthless pursuit of ends.

452
00:34:33.200 --> 00:34:36.940
Valentine became obstructive, Galt grew irritable.

453
00:34:36.940 --> 00:34:40.520
They ceased to have any working contact, whatever.

454
00:34:40.520 --> 00:34:46.040
And although the organization to a man was sorry for Valentine, still there was a turning

455
00:34:46.040 --> 00:34:51.280
to Galt, purely as an instinctive reaction to strength.

456
00:34:51.280 --> 00:34:56.320
As a railroad executive, Valentine, for all his experience, was inefficient.

457
00:34:56.320 --> 00:34:59.760
This had been always tolerantly understood.

458
00:34:59.760 --> 00:35:05.800
But now, with Galt's work beginning to produce results, in contrast, the fact was openly

459
00:35:05.800 --> 00:35:06.800
admitted.

460
00:35:06.800 --> 00:35:11.280
Galt's touch was sure, propulsive, and unhesitating.

461
00:35:11.280 --> 00:35:16.520
And besides, in whatever he did, there was an element of fortuity that could not be reasoned

462
00:35:16.520 --> 00:35:17.520
about.

463
00:35:17.520 --> 00:35:23.240
He not only did the right things, he did them at precisely the right time.

464
00:35:23.240 --> 00:35:27.800
You remember what I told you a long time ago, said Harbinger.

465
00:35:27.800 --> 00:35:30.520
He sees things before they happen.

466
00:35:30.520 --> 00:35:35.200
My heart breaks for the old man, but it's no use.

467
00:35:35.200 --> 00:35:39.500
The site of inspired craftsmanship is irresistible to men.

468
00:35:39.500 --> 00:35:45.000
The organization wavered between affection for the one and awe of the other and ended

469
00:35:45.000 --> 00:35:50.780
by giving its undivided loyalty to Galt, not for love of his eyes, but for reasons that

470
00:35:50.780 --> 00:35:53.100
were obvious.

471
00:35:53.100 --> 00:35:58.880
One day Mr. Valentine complained that I was unable to serve him and Galt both, and asked

472
00:35:58.880 --> 00:36:03.360
me gently if I did not wish to go entirely to Galt.

473
00:36:03.360 --> 00:36:08.360
He had guessed my inclinations, so we shook hands and parted.

474
00:36:08.360 --> 00:36:14.360
Thereafter, my place was in Galt's room, and I attended the board meetings as his private secretary.