TO GERMAN MINISTER VON ECKHARDT, Mexico City.

In the President's Flag Day address, delivered at Washington on June 14, 1917, appeared the following:

They [meaning Germany] sought by violence to destroy our industries and arrest our commerce. They tried to incite Mexico to take up arms against us and to draw j.a.pan into an hostile alliance with her; and that, not by indirection, but by direct suggestion _from the Foreign Office at Berlin_.

As the storm of ridicule and criticism of his policy of watchful waiting beat fiercely upon him, I often wondered if he felt the petty meanness which underlay it, or was disturbed or dispirited by it. As the unkind blows fell upon him, thick and fast from every quarter, he gave no evidence to those who were close to him of any irritation, or of the deep anger he must have felt at what appeared to be a lack of sympathy on the part of the country toward the idealistic policy in the treatment of Mexican affairs. Never for a single moment was he driven from the course he had mapped out for himself. He had given his heart and soul to a great humane task and he moved toward its consummation amid a hurricane of protests and criticisms.

There was a time, however, when I thought he displayed chagrin and disappointment at the obstacles placed in his path in settling the affairs of Mexico. It was in a little speech delivered at the Brooklyn Navy Yard on the occasion of the burial of the Marines who fell at Vera Cruz. The following paragraph contained a note of sadness and even depression.

Perhaps, in the following words, he pictured his own loneliness and utter dejection:

I never went into battle; I never was under fire; but I fancy there are some things just as hard to do as to go under fire. I fancy that it is just as hard to do your duty when men are sneering at you as when they are shooting at you. When they shoot at you, they can only take your natural life; when they sneer at you, they can wound your living heart, and men who are brave enough, steadfast enough, steady in their principles enough, to go about their duty with regard to their fellow-men, no matter whether there are hisses or cheers, men who can do what Rudyard Kipling in one of his poems wrote, "Meet with triumph and disaster and treat those two imposters just the same," are men for a nation to be proud of. Morally speaking, disaster and triumph are imposters. The cheers of the moment are not what a man ought to think about, but the verdict of his conscience and of the consciences of mankind.

CHAPTER XXI

PANAMA TOLLS

In an introduction to "The Panama Ca.n.a.l Tolls Controversy," edited by Hugh Gordon Miller and Joseph C. Freehoff, Mr. Oscar S. Straus wrote: "There is no more honourable chapter in the highly creditable history of the diplomacy of our country than the repeal of the Panama Tolls Act under the present administration. Being a controversy affecting our international relations, it is gratifying that, aside from the leadership of the President, the repeal was effected not solely by the party in power, but by the help of leaders in all three parties, rising above the plane of partisan politics to the higher reaches of broad statesmanship, guided by a scrupulous regard for our international character in accord with 'a decent respect for the opinions of mankind,' as expressed in the Declaration of Independence." President Wilson himself, after the repealing act had been pa.s.sed, remarked, "When everything else about this Administration has been forgotten, its att.i.tude on the Panama Tolls treaty will be remembered as a long forward step in the process of making the conduct between nations the same as that which obtains between honourable individuals dealing with each other, scrupulously respecting their contracts, no matter what the cost."

In making his recommendations to Congress he, almost with high disdain, ignored legal technicalities and diplomatic quibbles and took high moral ground. Said he, "The large thing to do is the only thing we can afford to do, a voluntary withdrawal from a position everywhere quoted and misunderstood. We ought to reverse our action without raising the question whether we were right or wrong, and so once more deserve our reputation for generosity and for the redemption of our every obligation without quibble or hesitation."

An act pa.s.sed in 1912 had exempted American coastwise shipping pa.s.sing through the Ca.n.a.l from the tolls a.s.sessed on other vessels, and the British Government had protested against this on the ground that it violated the Hay-Pauncefote treaty of 1901, which had stipulated that the Ca.n.a.l should be open to the vessels of all nations "on terms of entire equality." Other nations than England had an interest in this question, and there was a suspicion that some of them were even more keenly if not more heavily interested; but England took the initiative, and the struggle to save the exemption was turned, in the United States, into a demonstration by the Irish, Germans, and other anti-British elements.

Innate hostility to England and coastwise shipping interests formed the backbone of the opposition to any repeal of this exemption, but the Taft Administration had held that the exemption did not conflict with the treaty (on the ground that the words "all nations" meant all nations except the United States), and British opposition to the fortification of the Ca.n.a.l, as well as the att.i.tude of a section of the British press during the Canadian elections of 1911, had created a distrust of British motives which was heightened by the conviction of many that the Hay- Pauncefote Treaty had been a bad bargain.

It was understood early in President Wilson's Administration that he believed the exemption was in violation of the treaty, but not until October did he make formal announcement that he intended to ask Congress to repeal it. The question did not come into the foreground, however, until March 5, 1914, when the President addressed this request to Congress in ominous language, which to this day remains unexplained. "No communication I addressed to Congress," he said, "has carried with it more grave and far-reaching implications to the interests of the country."

After expressing his belief that the law as it stood violated the treaty and should be repealed as a point of honour, he continued: "I ask this of you in support of the foreign policy of the Administration. I shall not know how to deal with other matters of even greater delicacy and nearer consequence if you do not grant it to me in ungrudging measure."

The first word I received that the President contemplated addressing Congress, asking for the repeal of Panama Tolls, came about in this way: I was notified after dinner one evening that the President wished to confer with me in his study. When I arrived at the White House Mrs. Wilson met me and informed me of the plan which the President had in mind with reference to this matter and of his decision to issue a statement that night which would be carried in the newspapers the following morning, and of his determination to address Congress, asking for a repeal of the Panama Tolls. Mrs. Wilson showed considerable excitement over the President's proposed step when she discussed the matter with me as I arrived at the White House. She said she had argued with the President and had tried to persuade him that if he intended to do so unusual a thing that now was the inopportune moment for it for the reason that it would create a party crisis and probably a split, the result of which we could not foresee.

When I went into the President's study, he read me the announcement he had prepared for the papers. The full significance and the possible danger which lay in the proposed move that the President was about to make struck me at once. Frankly I put the whole political situation in the country before him as it would be affected by his att.i.tude in this matter, saying to him that the stand he was about to take would irritate large blocks of Irish, Germans, and other anti-British elements in the country, and that we might expect that the leaders in our own party, the heads of the various committees, like Fitzgerald of Appropriations, Underwood of the Ways and Means, and Clark, the Speaker of the House, would be found in solid opposition, and that, at a time when we needed every bit of strength to put our party programme of domestic legislation into effect, it seemed to me unwise to inject this matter, which could only be a disturbing element, into our party's councils. In discussing the matter with me, after I had presented the objections to it, which I did with great feeling and probably some irritation, he said: "I knew the view you would take of it, but, unfortunately, every argument you lay before me in opposition to the programme I have outlined in this statement is purely a partisan one and one whose value I cannot recognize at this time. I must not count the effect of a move of this kind upon my own personal political fortunes. I am the trustee of the people and I am bound to take cognizance of the fact that by reason of our att.i.tude on Panama Tolls our treaties are discredited in every chancellery of Europe, where we are looked upon as a nation that does not live up to its plighted word. We may have made a very bad bargain with England on Panama Tolls, but it will be all the more credit to us if we stand by an agreement even when it entails a sacrifice on our part. The men who were parties to this treaty, like Joseph Choate, all agree that we have been indulging in hair-splitting and that we have done a great injustice to England. I ought not, therefore, to be afraid, because of the antagonisms that will be created, to do my duty and risk my political future if necessary in righting a great wrong. We cannot expect to hold the friendship of the world, especially of England, France, and j.a.pan, if we are to treat agreements not as inviolable contracts, but as mere matters of convenience, whose plain terms are to be ignored when matters of expediency dictate. I know that the Irish, through the Hearst newspapers, will cry out that I have surrendered to England, that I am attempting to hand over to Europe a quasi-control over the Panama Ca.n.a.l.

As a matter of fact, we are in bad by reason of our att.i.tude on Panama Tolls with various leading nations of Europe, and some unforeseen contingency may arise where it will be found that the reason for their withdrawal of friendship for us was our petty att.i.tude in this matter. I realize, as you urge, that the leaders of our party will be found in opposition, but I must forget this and try to work the matter out so that at least I shall have cleared my skirts and have done what is possible for me to do to right a great wrong."

When the President concluded his statement I put before him the possible reaction against his administration and him personally which might be reflected in the returns of the Congressional elections to be held that year. He replied by saying: "I have calculated every element in the situation and I have concluded where the path of duty lies. If we begin to consider the effect upon our own political fortunes of every step we take in these delicate matters of our foreign relations, America will be set adrift and her word questioned in every court in Europe. It is important that every agreement that America subscribes her name to shall be carried out in the spirit of those who negotiated it."

On March 5, 1914, the President addressed Congress and asked for a repeal of Panama Tolls and immediately the fierce fires of party opposition began to burn. His party leaders expressed their opposition to the repeal in open, honourable, and vigorous fashion and the fight was on. Now that the leading Democrats in the Senate and House had left us, it was necessary for us to reorganize our forces at once. This task devolved upon me and I immediately got in touch with younger men of the House, like Mitch.e.l.l Palmer, Judge Covington, and that st.u.r.dy Republican from Minnesota, Fred Stevens, and over night we had a militant organization in the trenches, prepared to meet the onslaught of our enemies.

The President was adamant under the bitterest criticism. His att.i.tude brought down on him a shower of personal abuse and vituperation from Irish organs and from a group of newspapers which presently were to appear as the chief supporters of Germany. The arguments against the repeal were unusually bitter, and even though Elihu Root, leading Republican senator, in a brilliant and effective speech took his stand by the President and against the recent Republican Administration, partisan criticism seized upon the opening. Nevertheless, the tolls exemption was repealed in June and the events of July and August, 1914, and especially after Von Bethmann-Hollweg stood up in the German Reichstag and characterized the treaty between Germany and Belgium as a mere sc.r.a.p of paper, gave a certain satisfaction to those who stood by the President for the sanct.i.ty of treaties.

Sir Edward Grey, then Secretary of State for Foreign Affairs, commenting upon the action in the House of Commons said: "It has not been done to please us, or in the interest of good relations, but I believe from a much greater motive--the feeling that a government which is to use its influence among nations to make relations better must never, when the occasion arises, flinch or quail from interpreting treaty rights in a strictly fair spirit."

CHAPTER XXII

REFORMING THE CURRENCY

I have bitterly resented at times the imputation and charge that Woodrow Wilson is so egotistical, self-willed, and so wedded to his own ideas that he not only does not invite suggestion from the outside but that he resents it and refuses to be guided by it.

I feel that my daily intimacy with him for eleven years gives me the right to speak frankly in the matter. Of course, like every great man, he is firmly set in his opinions. He holds and cleaves to them with a pa.s.sionate devotion and tenacity but only after the fullest consideration of all the facts and information upon which he bases a final conviction. Time and again I have seen him gallantly retreat under the fire of a better argument in a matter that he had been previously disposed to favour.

And what of his att.i.tude toward those who came to the Executive offices to argue with him on some vital matter in which he had formed what appeared to be an unalterable judgment? Never did he a.s.sume the unfriendly or unyielding att.i.tude of the doctrinaire or the man of a single idea. I recall a case in point. He was discussing the revenue situation with Representative Claude Kitchin of North Carolina, at a time when it was the subject of bitter controversy in the ranks of the Democratic party. The President and Mr. Kitchin held radically divergent views on this matter; the President sought to lead the party in one direction and Mr. Kitchin openly pursued an opposite course. I was present at this conference. No warm friendship existed between these two men; but there was never any evidence of hostility in the President's att.i.tude toward Mr. Kitchin. He listened politely and with patience to every argument that Mr. Kitchin vigorously put forward to sustain his contention in the matter, and took without wincing the sledgehammer blows often dealt by Mr. Kitchin. The President replied to Mr. Kitchin's arguments in an open, frank manner and invited him to the fullest possible discussion of the matter.

I recall the conclusion of this interview, when it seemed that, having driven the President from point to point, Mr. Kitchin was the victor.

There was no disappointment or chagrin evident in the President's manner as he faced Mr. Kitchin to accept his defeat. He met it in true sportsmanlike fashion. At the conclusion of Mr. Kitchin's argument the President literally threw up his hands and said, quietly, without showing a trace of disappointment: "I surrender, Mr. Kitchin. You have beaten me.

I shall inform my friends on the Hill that I was mistaken and shall instruct them, of course, to follow you in this matter."

I could crowd this chapter with similar incidents, but it would be a work of supererogation.

Never before was Mr. Wilson's open-minded desire to apply in practice the principle of common counsel better ill.u.s.trated than in his handling of the important work in connection with the establishment of the Federal Reserve Act, the keystone of the great arch of the Democratic Administration. It was the first item in his programme to set business free in America and to establish it upon a firm and permanent basis. He aptly said to me, when he first discussed the basic reason for the legislation, he wished not only to set business free in America, but he desired also to take away from certain financial interests in the country the power they had unjustly exercised of "hazing" the Democratic party at every Presidential election.

Shortly after the Presidential election in 1912, while he was burdened with the responsibilities of the Executive office at Trenton, New Jersey, he began, in collaboration with that fine, able, resourceful Virginian, Representative Carter Gla.s.s, then chairman of the Banking and Currency Committee of the House, the preparation of the Federal Reserve Banking and Currency Act. For hours at the Executive office in Trenton the Virginia Congressman conferred with the Governor of New Jersey over the preliminary drafts of this most vital piece of legislation. For days the work of preparation was carried on, so that when Mr. Wilson arrived in Washington to take up the duties of the Presidency, the Banking and Currency Bill was in shape and ready for immediate introduction in the Senate and House.

Looking back over the struggle that ensued from the time this measure was introduced into the Senate and House, I often wonder if the people "back home," especially the various business interests of the country, who have been saved from financial disaster by this admirable and wholesome piece of legislation, ever realized the painstaking labour and industry, night and day, which Woodrow Wilson, in addition to his other mult.i.tudinous duties, put upon this task. Could they but understand the character of the opposition he faced even in his own party ranks, and how in the midst of one of Washington's most trying summers, without vacation or recreation of any kind, he grappled with this problem in the face of stubborn opposition, they would, perhaps, be willing to pay tribute to the earnestness and sincerity of this man who finally placed upon the statute books one of the greatest constructive pieces of legislation of half a century. Having given his heart to this important task, whose enactment into law was a boon to business and established for the first time in America a "Democracy of Credit," as he was pleased to call it, he relentlessly pursued his object until senators and representatives yielded to his insistent request for the enactment of this law, not under the stress of the party whip, but through arguments which he pa.s.sionately presented to those who sought his counsel in this matter.

During this time I gladly accepted the President's invitation to spend the summer with him at the White House, where I occupied the bedroom that had been used as Mr. Lincoln's Cabinet Room, and where Mr. Lincoln had signed his famous Emanc.i.p.ation Proclamation. My presence, during that summer, as a member of the President's family, gave me a good opportunity to see him in action in his conferences in regard to the Federal Reserve Act. Never was greater patience, forbearance, or fort.i.tude, shown by a chief executive under such trying circ.u.mstances. Day after day, when it seemed as if real progress was being made, unexpected opposition would develop and make it necessary to rebuild our shattered lines, until finally the bill was out of the House and on its way to the Senate.

Its arrival in the Senate was but the beginning of what appeared an almost interminable struggle. The President's stalwart adviser in the Treasury, Mr. McAdoo, was always at hand to rally and give encouragement to our forces, many of whom at times were in despair over the prospects of the bill. The leaders of the opposition on the committee were Senator Root on the Republican side and Senators O'Gorman and Reed on the Democratic.

It seemed at times as if they had succeeded in blocking an agreement on the Conference Report. At last word was brought to the President by Representative Gla.s.s that the opposition of these gentlemen might succeed in killing the bill. The President up to this time, although fighting against great odds, showed no impatience or petulancy, but the message brought by Mr. Gla.s.s was the last straw. Looking at Mr. Gla.s.s, with a show of fire and in a voice that indicated the impatience he felt, the President said: "Gla.s.s, have you got the votes in the committee to override these gentlemen [meaning O'Gorman and Reed]?" Gla.s.s replied that he had. "Then," said the President, "outvote them, d.a.m.n them, outvote them!"

Mr. McAdoo came to the White House a few days later to make a report about the situation in the Senate, with reference to the Federal Reserve Act.

His report was most discouraging as to the final pa.s.sage of the bill. He said that his information from the Hill was that the leaders of the opposition in the Senate were bent upon a filibuster and that the probabilities were that the Senate would finally adjourn without any action being taken on the Federal Reserve Act.

This conversation took place on the White House portico, which overlooks the beautiful Potomac and the hills of Virginia. It was one of the hottest days in June, a day which left all of us who were about the President low in spirit. Only those who know the depressing character of Washington's midsummer heat can understand the full significance of this statement. The President on this occasion was seated in an old-fashioned rocker, attired in a comfortable, cool-looking Palm Beach suit. Mr. McAdoo reported the situation in detail and said that, in his opinion, it was hopeless to try to do more with the bill: that an impa.s.se had been reached between the Senate and the House. The President quickly interrupted Mr. McAdoo, saying, with a smile: "Mac, when the boys at Princeton came to me and told me they were going to lose a football game, they always lost. We must not lose this game; too much is involved. Please say to the gentlemen on the Hill who urge a postponement of this matter that Washington weather, especially in these days, fully agrees with me and that unless final action is taken on this measure at this session I will immediately call Congress in extraordinary session to act upon this matter." This challenge, brought to the Hill by Mr. McAdoo, quickly did the job and the bill was soon on its way to the White House.

Mr. Wilson conducted the conferences in this matter with friends and foes alike with a quiet mastery and good temper diametrically contrary to the reports sedulously circulated for political purposes, that he was autocratic and refused to cooperate with the members of the Senate and House in an effort to pa.s.s legislation in which the whole country was interested.

We have only to recall the previous attempts made by former administrations to legislate upon the currency question, especially the efforts of the Harrison and Cleveland administrations, to understand and appreciate the difficulties that lay in the path of Woodrow Wilson in his efforts to free the credit of the country from selfish control and to push this vital legislation to enactment. Previous attempts had always resulted in failure and sometimes in disaster to the administrations in control at the time. The only evidences of these frequent but abortive efforts to pa.s.s currency legislation were large and bulky volumes containing the hearings of the expensive Monetary Commission that had been set up by Senator Aldrich of Rhode Island. As an historian and man of affairs, Woodrow Wilson realized the difficulties and obstacles that lay in his path in attempting to reform the currency, but he was not in the least daunted by the magnitude of the task which confronted him. He moved cautiously forward and pressed for early action at the first session of the Congress following his inauguration. He realized that with the pa.s.sage of the tariff legislation, which always acts as a business depressant, it was necessary at the same time to have the stimulus the Currency Bill would afford when enacted into law. The split of '96 in the Democratic ranks over the money question was an additional reason for cautious and well-considered action if the Federal Reserve Bill was to become a reality.

The presence of Mr. Bryan in the Cabinet and his well-known views on this question were strong reasons for watchful and careful prevision. It was obvious to Mr. Wilson from the outset that insurmountable difficulties lay in his path, but he brushed them aside as if they were inconsequential.

In the Committee on Banking and Currency, in both the Senate and House, were many ardent and devoted friends of Mr. Bryan, who thought that his radical views on the money question could be used as a rallying point for opposition to the President's plan for currency reform. But those who counted on Mr. Bryan's antagonism were doomed to disappointment and failure, for while it is true that Mr. Bryan found serious objections to certain parts of the bill, when these were eliminated he moved forward with the President in the most generous fashion and remained with him until the Federal Reserve Act was made part of the law of the land.

It was in a conference with members of the Banking and Currency Committee that I first saw the President in action with the gentlemen of the Senate and House. He had invited the Democratic members of the Banking and Currency Committee to confer with him in the Cabinet Room in the White House offices. From my desk in an anteroom I heard all the discussions of the bill. There was full, open discussion of the bill in all its phases at this conference in which were collected the conservatives of the East, the radicalists of the West, and those who came to be known as the "corn ta.s.sel" representatives of the South, all holding widely divergent views and representing every shade of opinion, some of it sharply antagonistic to the President's views. Some of the members were openly hostile to the President, even in a personal way, particularly one representative from the South, and some of the questions addressed to the President were ungracious to the verge of open insult. It was an exasperating experience, but Mr. Wilson stood the test with patience, betraying no resentment to impertinent questions, replying to every query with Chesterfieldian grace and affability, parrying every blow with courtesy and gentleness, gallantly ignoring the unfriendly tone and manifest unfairness of some of the questions, keeping himself strictly to the merits of the discussion, subordinating his personal feelings to the important public business under consideration, until all his interrogators were convinced of his sincerity and fair-mindedness and some were ashamed of their own ungracious bearing.

It was clear to me as I watched this great man in action on this trying occasion that in the cause he was defending he saw, with a vision unimpaired and a judgment unclouded by prejudice or prepossessions, far beyond the little room in which he was conferring. He saw the varied and pressing needs of a great nation labouring now under a currency system that held its resources as if in a strait-jacket. He saw in the old monetary system which had prevailed in the country for many years a prolific breeder of panic and financial distress. He saw the farmer of the West and South a plaything of Eastern financial interests. And thus, under the leadership of Woodrow Wilson was begun the first skirmish in the great battle to free the credit of the country from selfish control, a movement which led to the establishment of a financial system that ended for all time the danger or possibility of financial panic.

There was an interesting incident in connection with the handling of the currency legislation that brought about what threatened to be the first rift in the President's Cabinet. It concerned Mr. Bryan's att.i.tude of opposition to certain features of the bill as drafted by the Banking and Currency Committee of the House. My connection with this particular affair arose in this way: In the early stages of the discussion of the Federal Reserve Act, and while Mr. Gla.s.s's committee was considering the matter, a messenger from the White House informed me that the President wished to confer with me in his study. As I walked into the room, I saw at once from his general att.i.tude and expression that something serious was afoot and that he was very much distressed. Turning around in his chair he said: "It begins to look as if W. J. B. [he thus referred to Mr. Bryan] and I have come to the parting of the ways on the Currency Bill. He is opposed to the bank-note feature of the bill as drawn. We had a long discussion about the matter after Cabinet meeting to-day. In thoroughly kindly way Mr. Bryan informed me that he was opposed to that feature of the bill. Of course, you know, W. J. B. and I have never been in agreement on the money question. It is only fair, however, to say that in our discussion Mr.

Bryan conducted himself in the most generous way, and I was deeply touched by his personal att.i.tude of friendliness toward me. He even went so far as to say that in order that I might not be embarra.s.sed in the handling of the bill, he was willing to resign and leave the country and make no public criticism of the measure. In the meantime, Mr. Bryan has promised to say nothing to any one about the matter until he has a further discussion with me."

The President then frankly discussed with me the effect of the possible resignation of Mr. Bryan. The President suggested that I drop in on Mr.

Bryan very soon and if possible casually invite a discussion of the Federal Reserve Act, telling Mr. Bryan of his [the President's] interests in it, and how much he appreciated Mr. Bryan's personal att.i.tude toward him.

I realized the seriousness and delicacy of the situation I was asked to handle, and, being on the friendliest terms with Mr. Bryan, I telephoned him and invited myself to his home--the old Logan Mansion, a beautiful place in the northwest part of Washington. I found Mr. Bryan alone when I arrived. We went at once to his library and, in a boyish way, he showed me a picture which the President had autographed for him only a few days previous. As we stood before this picture Mr. Bryan gave expression to his sincere admiration and affection for the President. He related, with deep feeling, how much Mr. Bryan had enjoyed his contact and official companionship with him and how he had come to have a very deep affection for him. As we turned away from the picture, he grew serious and began the discussion of the very thing the President and I had conferred on only a few hours before. He freely discussed his differences with the President over the Federal Reserve Act, and asked me the direct question: "Who from Wall Street has been discussing this bill with the President? I am afraid that some of the President's friends have been emphasizing too much the view of Wall Street in their conferences with the President on this bill."

I frankly told Mr. Bryan that this imputation did a great injustice to the fine men with whom the President conferred on the matter of banking reform and that I was certain that the President's only intimate advisers in this matter were Mr. McAdoo, Senator Owen of Oklahoma, and Mr. Gla.s.s of Virginia, and that I personally knew that in their discussions the President never argued the point of view of the Eastern financial interests. Mr. Bryan was rea.s.sured by my statement and proceeded to lay before me his objections to the character of the currency issue provided for in the bill. He then took from the library shelves a volume containing all the Democratic National platforms and read excerpts from them bearing upon the question of currency reform. He soon convinced me that there was great merit in his contention. Before leaving him, I told him of my interview with the President and how deeply distressed he [the President]