“But by the side of Andrew Carnegie’s giganticvertical trust， a trust owned and operated by fiftythreepartners， those other combinations werepicayune. They might combine to their heart’s contentbut the whole lot of them couldn’t make a dent in theCarnegie organization， and Morgan knew it.
“The eccentric old Scot knew it， too. From themagnificent heights of Skibo Castle he had viewed，first with amusement and then with resentment， theattempts of Morgan’s smaller companies to cut intohis business. When the attempts became too bold，Carnegie’s temper was translated into anger andretaliation. He decided to duplicate every mill ownedby his rivals. Hitherto， he hadn’t been interested inwire， pipe， hoops， or sheet. Instead， he was contentto sell such companies the raw steel and let themwork it into whatever shape they wanted. Now， withSchwab as his chief and able lieutenant， he plannedto drive his enemies to the wall.
“So it was that in the speech of Charles M.
Schwab， Morgan saw the answer to his problem ofcombination. A trust without Carnegie-giant of themall—would be no trust at all， a plum pudding， as onewriter said， without the plums.
“Schwab’s speech on the night of December 12，1900， undoubtedly carried the inference， thoughnot the pledge， that the vast Carnegie enterprisecould be brought under the Morgan tent. He talkedof the world future for steel， of reorganization forefficiency， of specialization， of the scrapping ofunsuccessful mills and concentration of effort onthe flourishing properties， of economies in the oretraffic， of economies in overhead and administrativedepartments， of capturing foreign markets.
“More than that， he told the buccaneers amongthem wherein lay the errors of their customarypiracy. Their purposes， he inferred， bad been to createmonopolies， raise prices， and pay themselves fatdividends out of privilege. Schwab condemned thesystem in his heartiest manner. The shortsightednessof such a policy， he told his hearers， lay in the factthat it restricted the market in an era when everythingcried for expansion. By cheapening the cost of steel，he argued， an ever-expanding market would becreated； more uses for steel would be devised， and agoodly portion of the world trade could be captured.
Actually， though he did not know it， Schwab was anapostle of modern mass production.
“So the dinner at the University Club came to anend. Morgan went home， to think about Schwab’srosy predictions. Schwab went back to Pittsburgh torun the steel business for ‘Wee Andra Carnegie，’ whileGary and the rest went back to their stock tickers， tofiddle around in anticipation of the next move.
“It was not long coming. It took Morgan aboutone week to digest the feast of reason Schwab hadplaced before him. When he had assured himselfthat no financial indigestion was to result， he sentfor Schwab-and found that young man rather coy.
Mr. Carnegie， Schwab indicated， might not like itif he found his trusted company president had beenflirting with the Emperor of Wall Street， the Streetupon which Carnegie was resolved never to tread.
Then it was suggested by John W. Gates the gobetween，that if Schwab ‘happened’ to be in theBellevue Hotel in Philadelphia， J. P. Morgan mightalso ‘happen’ to be there. When Schwab arrived，however， Morgan was inconveniently ill at his NewYork home， and so， on the elder man’s pressinginvitation， Schwab went to New York and presentedhimself at the door of the financier’s library.
“Now certain economic historians have professedthe belief that from the beginning to the end of thedrama， the stage was set by Andrew Carnegie—that the dinner to Schwab， the famous speech， theSunday night conference between Schwab and theMoney King， were events arranged by the cannyScot. The truth is exactly the opposite. WhenSchwab was called in to consummate the deal，he didn’t even know whether ‘the little boss，’ asAndrew was called， would so much as listen to anoffer to sell， particularly to a group of men whomAndrew regarded as being endowed with somethingless than holiness. But Schwab did take into theconference with him， in his own handwriting， sixsheets of copperplate figures， representing to hismind the physical worth and the potential earningcapacity of every steel company he regarded as anessential star in the new metal firmament.
“Four men pondered over these figures all night.
The chief， of course， was Morgan， steadfast in hisbelief in the Divine Right of Money. With him washis aristocratic partner， Robert Bacon， a scholar anda gentleman. The third was John W. Gates whomMorgan scorned as a gambler and used as a tool.
