We The People Features - Taxes - Philander Knox -
[Cached Version]
Published on: 3/31/1999
Last Visited: 6/2/2006
WHO WAS PHILANDER KNOX? IS IT CREDIBLE THAT HE WOULD COMMIT FRAUD?
Understanding a crime or a misdeed involves learning not only what was done and who did it, but also what the motivation was.With a clear motive, evidence of the "what" and "who" becomes much more credible.Allegations that Secretary of State Philander Knox was not merely in error, but committed fraud when he falsely declared the 16th amendment ratified in 1913, require us to look at who he was to understand why he would commit such an act.
...
Philander Chase Knox was born in 1853 in western Pennsylvania, son of a bank cashier.While attending college in Ohio, he became closely acquainted with William McKinley, then the local district attorney, who was prosecuting a local tavern owner for selling alcohol to the college students.Knox took McKinley's advice and became a lawyer.
McKinley, having chaired the powerful House Ways and Means Committee in Congress, was elected governor of Ohio in 1891.Although he owed his election to support from both business and labor, he quelled the labor strike called by Eugene V. Debs against the Great Northern Railroad in 1894 by summoning federal troops.
McKinley won the 1896 presidential race with a great deal of support from Big Business, e.g., John D. Rockefeller's Standard Oil contributed $250,000 to the "front porch" campaign that defeated Bryan and his populist platform of returning to the constitutionally mandated monetary system and reform of McKinley's high tariffs that had allowed domestic manufacturers to raise their prices to a level that matched the artificially-induced higher prices of foreign goods, thus causing a severe depression.Knox helped in this financial and political effort that was directed by the wealthy Ohio industrialist Mark Hanna, who was appointed to a vacant U.S. Senate seat the following year by Ohio's governor.
...
Knox came to be regarded as one of the ablest lawyers in the country, his repute due in no small measure to his being counsel for Carnegie and Vanderbilt and their corporate enterprises.He was instrumental in Carnegie's big victory in a crucial patent case in which the most important invention for the manufacture of crude steel was at stake.In 1892, he defended Henry Frick, Carnegie's steel plant manager, who was being sued by the steel workers who had been beaten up by Pinkertons brought in by Frick during the infamous Homestead strike, a strike that was provoked by two of Carnegie's presidents, one of whom was also an attorney for J.P. Morgan.Knox also deflected prosecution and civil suit against Carnegie in 1894 after it was shown to Congress that Carnegie had defrauded the Navy with inferior armor plate for U.S. warships.Morgan himself had defrauded the U.S. Army in arms sales during the Civil War.And Knox averted prosecution of Carnegie after the president of the Morgan-controlled Pennsylvania Railroad testified that Carnegie had regularly received illegal kickbacks from the railroad.Knox's other big client at the time, the Vanderbilt family, was connected to Carnegie primarily through the railroad industry.
President McKinley offered Knox the post of U.S. Attorney General in 1899, but Knox had to decline, because he was then and for two more years engaged in arranging the merger of the railroad, oil, coal, iron and steel interests of Carnegie, J.P.
...
After the U.S. Steel merger, Knox accepted McKinley's offer to make him Attorney General, an appointment that was personally promoted by Carnegie in a letter to McKinley and by Morgan in a personal visit to the White House.The appointment was strenuously and loudly opposed by anti-trust forces, since it would then be up to Knox to prosecute anti-trust law violations against the very robber barons who had been his clients for many years and who had made him a wealthy man. Sure enough, the public outcry to investigate the big new U.S. Steel monster that Knox had created met with Knox's response that he knew nothing and could do nothing, and nothing is what he did.
After McKinley's assassination in 1901, Knox continued as Attorney General under Theodore Roosevelt.Even though Roosevelt labeled himself as a "trust-buster," Knox saw to it that very little harm came to his benefactors.
...
Knox persuaded Roosevelt that the anti-trust laws should be accompanied by increased regulation of business.
...
Knox continued in this vein as a U.S.Senator from Pennsylvania, being appointed to a vacant seat by Pennsylvania's governor in 1904 at the behest of several powerful capitalists, including Carnegie's man, former client Frick (which showed they approved of Knox's handling of anti-trust matters as Attorney General).
Knox, by now a multi-millionaire, was in the Senate when the Morgan-controlled financial Panic of 1907 hit, which led to a congressional inquiry into the monetary and banking systems.
...
Knox resigned from the Senate and became Secretary of State under President Taft from Ohio in 1909.He was the most powerful figure in the Taft administration, and drew up the lists from which Taft appointed his other cabinet members, many of whom were intimately concerned with the giant corporations.He was Taft's primary confidante.
Knox became active in organizing the international court at The Hague, and fought hard for the Rockefeller/Morgan-inspired concept of a League of Nations, although U.S. opposition to the Treaty of Versailles forced him to temper his public views on the League.He proclaimed the era of "Dollar Diplomacy," his legacy to U.S. foreign policy, under which the Secretary of State's office was used to promote and protect American commercial and industrial interests in foreign countries, especially in Latin America, but also in East Asia and even Europe.This period of U.S imperialism featured the annexation of Hawaii in the 1890s at the request of American businesses there despite the unanimous opposition by Hawaiians; the taking of Cuba and the Philippines from the Spanish as well as from the native rebels whom the U.S had ostensibly come to assist in gaining their liberty (this included the massive slaughter of a hundred thousand Filipinos by the U.S Army in a war in which the news media was censored. (even William Randolph Hearst, who had helped instigate the war with Spain, was aghast and disgusted.) Then came the Honduras financial crisis of 1909, in which Knox brokered a deal for J.P. Morgan & Company to make huge loans to that country, backed by the full faith and credit of the U.S., and for American bankers to take control of the Honduras taxing authority (to ensure adequate cash flow to make the loan payments).
...
Knox's diplomatic maneuvers resulted in the U.S. Navy being sent to support and give victory to rebel forces in Nicaragua, who then made arrangements, again devised by Knox, to give control of Nicaraguan taxing authority and tax collection to Americans.American bankers then immediately made big loans to Nicaragua, once again guaranteed by the U.S. government, providing a risk-free investment environment for Knox's banker friends.
Knox tried to conduct the same kind of activity in the rest of Central America and much of South America as well, and used America's claim against the Chinese from the Boxer Rebellion to coerce China to deal with a syndicate of Harriman and his bankers Kuhn & Loeb, Morgan and his First National Bank, and the Rockefeller-controlled National City Bank, instead of with the British, French, and Germans, in a scheme to establish a round-the-world transportation system using American steamship and railroad lines.
...
At the international level, Knox has been criticized for oafish and heavy-handed diplomacy that caused ill will and damaged the reputation of the United States worldwide.His conduct was more that of a huckster than a diplomat.Domestically, Knox's influence extended to the Supreme Court, where he succeeded in having Taft appoint three justices who were extremely sympathetic to the big business trusts: Devanter, Lamar, and Pitney.
...
Knox had protected them from fraud charges many times.His term as Attorney General was itself a big fraud in regard to enforcement of the anti-trust laws, especially against former clients to whom he owed so much of his own professional success.
Besides preying on the government with their fraudulent activities, the robber barons employed a strategy of locking in and stabilizing their advantageous positions by using government authority and regulations to reduce competition, keep prices at very profitable levels, control labor problems, minimize risk, and generally make themselves quite comfortable.They also expanded their scope of operations, including financing and extension of credit, to other countries and used government to aid them in these adventures.Knox, of course, was a key man, perhaps the key man, in the Administration in all of this, both as Attorney General and then as Secretary of State.
11 online sources [ view sources ]
Profile is not claimed [ claim profile ]
