A LIBERTARIAN'S DREAM

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, Oliver Diston, at the salary of $10 a month. When Jay started issuing his own maps for sale, Diston sued. Jay’s attorney, 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 and a private bank which Jay had established in Stroudsburg, apparently using company funds, but without the company sharing  in any profits. However, Jay had anticipated this, and had already lined up a richer and more docile partner. When confronted in August 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. By the fall of 1859 Lessup was panicked by the commitments Jay was making in his name. But it was too late. On October 6, 1859, facing financial disaster, Charles Lessup shot himself. Lessup’s daughters bitterly demanded Jay repay them for their father’s 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 families’ lawyers caught the omission. Still, in the early months of 1860, it became clear that Jay was still hiding assets from the family.

Lawyers and 40 deputized men were dispatched to the tannery on Tuesday morning, March 13, 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 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, and made the acquaintance of James “Big Jim” Fisk, who had made his own fortune smuggling southern cotton through the Federal armies, and selling Confederate War Bonds. And even while brave men died by their tens of thousands, this pair joined 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 New Jersey, 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 end. 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. 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 September 24, 1869, the sudden influx hit the market like a bomb, and gold dropped 30%. The date would henceforth be known as “Black Friday” - at least until October of 1929. Thousands of investors were wiped out, including Abel Corbin, and 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 Western Union, Jay and Selover happened to meet on the street one day. Jay tried to walk away, 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 wise 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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APPENDIX TO THE THEORY

I have a neat medical trick you can try at home. You will need to take off your shirt, and have a mirror and a marking pen at the ready. What you are first looking for is your hipbone. If you are an old fart like me, with 60 some years of subcutaneous fat accumulated, gently press in at your waist (or a reasonable approximation thereof) until you find it. The top of your hip is your illiac crest, and the most forward part of that is your anterior superior illiac crest. Mark this with a dot. Now find your belly button, which should be higher and dead center in your abdomen. Mark that with a dot, and try not to giggle while doing so. Now connect the dots with a straight line. Two thirds of the way down that line from your belly button is your McBurney's Point. And beneath your McBurney's Point is your appendix. Ta Da!

This magical location was discovered by Dr. Charles Herber McBurney (above),. And because he was a surgeon, Dr. McBurney's only interest in the appendix was when he wanted to cut it out. This was not easy, because between your magic marker and your appendix are your abdominal muscles. Slicing willy-nilly through these could make it very hard to continue breathing, which is very bad. But then if your appendix bursts open, that is also very bad. It was Dr. McBurney who developed the life saving operation called an appendectomy, where an appendix is safely removed. The procedure has become so standard that some people have their appendix taken out in advance, even though only 10% of the population develops appendicitis. “Better safe than sorry” is their motto. However the second most important motto in medicine should always be, “Not so fast.”

The proper name for this 4 inch long unprepossessing organ is the vermiform appendix, which means “a worm-shaped addition” (center), and humans aren't the only creatures with one. The 50 or so euarchontoglires which share this structure are both mammals and marsupials, including rodents, opossums, rabbits. wombats, tree shrews, flying lemurs, monkeys and humans. Most of them are vegetarians, which has inspired human vegetarians to celebrate the appendix as a vestige of their vegetarian ancestors. Unfortunately, it turns out, it isn't. In true vegetarians the appendix is a large organ, used to digest cellulose. In humans it's so small it seems like an after thought, an appendix to the main human story.

The human appendix juts out from the junction of the large and the small intestine. But unlike its neighbors the human appendix is just an empty sack that leads no where, inspiring Mark Twain to observe, “Its sole interest is to lie and wait for stray grape-seeds and breed trouble.” The trouble arrives with an infection, when the appendix swells up and bursts, spilling nasty bacteria all over your nice clean abdominal cavity. If you have a fever and are feeling a pain in your middle, find your McBurney's point and press down with one finger. If that causes excruciating pain, you are the unfortunate owner of a burst appendix, and you have a few hours to have it removed and your system flushed with antibiotics. Other wise, you are dead.

So here is this small, squishy sack, not much bigger than your index finger, that isn't connected to anything but your intestines, doesn't seem to produce anything, and you don't seem to miss it much when it's gone and occasionally it tries to kill you. Humans can be forgiving for thinking it was pretty much useless, like the last three vertebrae of your spine, all that is left of our once magnificent prehensile tails, reduced in modern humans to balancing you upright when your sitting on your butt. What good is an appendix?. For the last hundred years, the opinion of the medical community was almost universal, echoed by the authors of the medical textbook, “The Vertebrate Body”, “Its major importance would appear to be financial support of the surgical profession.”: written like a true diagnostician.

There is one hint about what the appendix might be doing, in that when you look at it in place it doesn't look like its neighbors, even when inflamed and surrounded by puss (above). Where the intestines are various shades of red, pink and purple, the appendix is white, and this is because it is made up of lymphatic tissue, Latin for “connected to water”. The most common member of this variety of cells, lymphocytes, are known as white blood cells . Their job is to identify invaders floating in our blood stream, and swallow them. So any lymphatic tissue, like that found in the appendix, must be concerned with defense: right?. But the appendix has only a tiny opening connecting it with the intestines, and a healthy appendix contains no bacteria that are not also present in the intestines. What could it be doing, if anything?

Well, it must be doing something, since the latest evolutionary genetic research indicates it has been invented 30 separate times in the euarchontoglires. And then about a decade ago it was discovered that lymphocytes also raise the “PH” level in your intestines, thus encouraging the 700 or so different species of “friendly” bacteria that we require to digest our food.

See, the healthy human gut is acidic - the small intestines have a PH factor of 6.8. This will not burn through steel, but the 10 trillion Prevotella, Bacteroides and Ruminococcus bacteria (amongst others) in your gut, require that acidity to thrive. They break the proteins and sugars that pass through your intestines into smaller molecules, and those are then filtered into the blood stream. An invasion of “bad bugs” reduces the acid level. That's why those bugs are bad. And you know the bad bugs outnumber the good ones in your gut when you get diarrhea. In other words you are not what you eat, but what you digest. Now, eventually your lymphocytes will eat the invaders in your blood stream, and the diarrhea will flush them out of your intestines. But how do you replace the good bugs in your intestines?

Well, according to Pediatrician Indi Trehan, at Washington University in St. Louis, that's where the lowly appendix comes into play. “The appendix has a unique anatomical location that is out of the way. Bacteria can be kept safe there for repopulating as needed,” he says. In other words, the appendix is a biological panic room. It keeps the good guys nice and safe, warm and happy, acidic and reproductive, even when your waiter forgets to wash his hands, or the tuna fish in the refrigerator goes bad, or the three bean salad is left out on the picnic table in the sun. It is in fact a validation of the theory of evolution- the use of available material to preform new functions.

Charles Darwin thought the appendix was vestigial, like your tail bone. He was wrong. Given the information available to us, he would have realized he was wrong. But its role as a panic room in the gut, and its constructed from cells that had been evolved for other uses, and that it was re-invented over and over in species with and without placentas, (mammals and marsupials) is proof of his fundamental idea of evolution. And so are the 10 trillion bacteria in your gut at this moment happily chomping away at your food, just like the bacteria in the gut of every living thing, from mosquitoes to elephants, even those without an appendix. .

This new view of the human vermiform appendix as a panic room, has supported a rethinking of Dr. McBurney's approach to an inflamed appendix. Increasingly patients are being admitted to hospitals, not for surgery, but for a heavy course of IV antibiotics. And as long as the appendix has not yet burst, usually, this works. It is cheaper and safer for the patient, and easier on the doctors, as it cuts down (pardon the pun) on panic surgeries. And it also makes the 10% of Christian Scientist with appendicitis,  happier as well.

I'm not sure what the “homeschooled” fundamentalist Christian children will do about all of this, the next time one of them has a pain in their gut. If, to quote Georgia Congressman Paul Broun, who is a medical doctor, the theory of evolution is a lie, “straight from the pit of hell”, then why would an IV course of antibiotics calm an inflamed appendix, irregardless of the state of grace of the owner of the appendix or the doctors, or the nurse who hangs the IV bag? I've said it before and I wll say it again here; belief in an almighty God does not require stupidity, no matter how many stupid people say otherwise. Evidently it doesn't hurt, but that is hardly a ringing eendorsement.

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LITTLE GREEN HOUSE Part Three

“I can take care of my enemies all right. But my damn friends, my God damn friends...they're the ones who keep me walking the floors nights.”

Warren G. Harding.

On the night of October 31, 1918 crowds jammed 9^th Street in Washington, D,C, lined with restaurants and bars, to share a final drink. Then, at midnight, November 1^st, 1918, the District of Columbia went bone dry, by federal fiat. It had been the pro-prohibition states that had re-elected President Woodrow Wilson in November of 1916. The imposition of prohibition in the one place on earth he could dictate it, was his reward for them. Opponents tried to give the local residents a vote on the issue, but Wilson complained, “There is no voting machinery in the District of Columbia. It would have to be created.” Still the option of giving democracy a chance inside the district was only defeated because the vote was tied – 43 pro and 43 con - and VP Thomas Marshall refused to cast the deciding vote – either way. That opened the door to the Sheppard Act, sponsored by Senator John Sheppard of Texas, which allowed the politicians to assure their moralistic supporters back home (in places like Texas) that they were being morally pure in far off Washington, D.C. Like bad fish,  the situation reeked with hypocrisy from the head.

- sung to the tune of “My bonnie lies over the ocean” -

My father makes book on the corner,
My mother makes illicit gin.
My sister sells kisses to sailors,
My God how the money rolls in.

(Chorus)

Rolls in , rolls in,
My God how the money rolls in, rolls in.
Rolls in, rolls in,
My God how the money rolls in.

When the Democrat Woodrow Wilson vacated the White House, he had the residence's extensive liquor stockpiles shipped to his new private home across town. The incoming President, Ohioan Warren G. Harding (above right), ordered his Attorney General, Harry Daugherty (above left), to replace it. The AG simply instructed his newly appointed Treasury Officer in charge of prohibition, Roy Asa Haynes, to stock Wells Fargo wagons with seized “illegal” booze and transport this forbidden aqua vitae several times a week,  guarded by armed IRS agents, to various locations inside the district for the consumption by privileged public servants. One of those locations was the second floor of the White House on Pennsylvania Avenue. Another was the “little white house” on H Street where Harding himself relaxed with alcohol and female companionship away from the prying eyes of the press and Mrs. Harding. Another was the little green house on K street, where something much more carnal than extramarital sex was going on.

My mother asks home politicians
To play in a night full of sin.
My father pops in with a camera.
My God, how the money rolls in!

(Chorus)

The tailored Howard Mannington was almost fifty when he arrived in Washington to work with the Harding administration. He was described as “jowly, square-headed, heavy-lidded, thick lipped with a pug nose.” He was a close friend of Daugherty's, and had been involved in Ohio Republican politics for more than twenty years. He was a charter member of what became known as The Ohio Gang. His partner was Mr. M.P. Kraffmiller, treasurer of the General American Tank Car Company, out of Chicago and Warren, Ohio. General American not only built railroad tank cars, but financed the purchase of them, much as car companies today finance the purchase of their cars. In both cases the leases provided yet another source of profit for the manufacturers. And that was the skill which Kraffmiller brought to the table for the Ohio Gang - managing large sums of cash. He and Mannington started out sharing a room in the Lafayette Hotel, at 16^th and I streets in Washington. But that was too visible a location. As of May 1, 1921, they signed a lease on the house at 1625 K street. It was perfect for their needs.

My mother's a bawdy house keeper,
Every night when the evening grows dim.
She hangs out a little red lantern,
My God how the money rolls in.

(Chorus)

What Federal Agent Gaston Means liked about the house at 1625 K Street was that it had both a front and a rear exit. A gate in the backyard fence gave access to a twisting ally which led directly to the Justice Department, and the offices of both Attorney General Harry Daugherty and his flunky, Jess Smith. Two blocks south of the house faced with green limestone, and a short walk across Lafayette Park, was the White House.

The first floor front room of the Little Green House (above) was a parlor. Beyond was Howard Mannington's office and conference rooms. On the second floor was a bar and poker rooms, and an office for Mr. Kraffmiller. On the third floor were the bedrooms, both public and private. In the basement Agent Means had his office, filled with files and maps of ports and highways, used for the distribution of now illegal liquor. Means' office was adjacent to a dinning room that seated 20, a kitchen with 3 stoves, a bathroom, and a laundry room. And in the back yard was "the safe".

My sister's a barmaid in Boston,
For a dollar she'll strip to the skin.
She's stripping from morning to midnight,
My God how the money rolls in.

(Chorus)

Agent Means had constructed the safe himself. The back gate was “as strong as the door on a bank vault”, Means testified later. “Entering this gate (with a special key), one was then inside a steel cage-confronted by another gate, equally as strong and opened only by another special key.” Beyond, in the very center of the yard, Agent Means dug a square, several feet wide. “After getting down a couple of feet or so, I had a wooden platform built...with an open space in the center. Then, I dug down...for twenty feet-and I lowered into this twenty-foot-deep hole a terracotta pipe about eight inches in diameter....I had a small steel box, which I kept lowered into this pipe by a strong rope."

In that steel box Howard Mannington said he usually kept between $50,000 and $5,000,000 in cash. For what the Ohio Gang was selling was the ultimate goal of every Washington lobbyist - access to key political decision makers. And the proof that they were very good at doing this, was that on an official public salary of seven dollars a day, agent Means owned a Washington townhouse with three servants and a chauffeur driven limousine. Two or three times each week Daugherty's sycophant Jess Smith dropped by K street to meet in private with Mannington in his first floor office, which is when and where the money changed hands. Agent Means admitted to often humming a tune to himself as he made deposits and withdraws from his backyard  K Street “bank”. The tune was “My God, how the money rolls in”.

My father makes rum in the bathtub

My mother make two kinds of Gin

My sister makes love for a living

My God how the money rolls in

(Chorus)

I’ve tried making all kinds of whiskey

I’ve tried making all kinds of Gin

I’ve tried making love for a living

My God the condition I’m in

(Chorus)

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