The Salt Lake tribune. [volume] (Salt Lake City, Utah) 1890-current, 1909-12-19
WESTERN UNIONS 80 YEARS. WAR


not himself designed the Atlantic and
Pacific. He had merely gone into it,.
He made up his mind to get out of it
on the best terms he could make. The
rate war lasted about two years, and
then the Western Union made terms.
IT. gave 1880 shares os it's own stock
and Sgl2.500 cash for $500 shares of
Atlantic and Pacific stock. That was a
little more than half, Mcssrs. Sage
and Kccnc delivered the stock; Jay
Could did not appear openly In the
transaction.
1t was announced that the Western
Union would simply hold the stock;
that the Atlantic and Pacific Telegraph
company would be separately operated,
and that with the cessation of wasteful
competition. il would be possible TO or
ganiZc service which would be more
Tcmunerativc TO tho companies, and, at
the same time, moro advantageous for
the public. This announcement might
almost have been copied from the rec
oTds for use in this week S discussion
of the Western Union Telegraph and
Telephone deal. The next annual report
of the Atlantic and Pacific Telegraph
company, that Of December 81, 1873.
showed that. 100 miles of poles, 036 miles
of wire and fifty-threc Offices had been
abandoned for the sake of economy.
Jay Gould then proceeded to design
telegraph company of his own. He
gave it the name of the American
Union. He organized a construction
company to build the telegraph lines,
and owned the construction company.
Telegraph lines were rapidly constructed
IN that day. BY 1879, tho American
Union was in a position to offer the
Western Union formidable competition
III some of its most productive terri
tory.
Game Of Bluff.
IT was formidable. but not danger
Gus competition for the Western Union.
Rates came tumbling down between
competitive points, but these points rep.
resented all the territory Of the new
American Union. and only part Of
the territory Of the Western Union. At
competitive points tho Western Union
was compelled to lose money, but no.
where else. II had the profits OF husi-
ness at all other points 10 fall back
upon. The American Union lost money
on all the business it did. A surviy
ing associate OF Mr.. Gould remarked
this week that it was the most out
right game of bluff he had ever wit
messed. The Vanderbilt interest who
controlled the Western Union. had only
to fight back and tho game was theirs,
because the American Union was losing
money every day, and becoming a Sc.
we're drain upon the private resources
of Mr.. Gould,
But Gould had other ways of fighting.
He controlled many miles OF railroad,
including tho Union Pacific, and most
Of his railroads were in contract re-
lations with The Western Union. To
abrogatc tho contracts meant litigation.
Mr. Gould first seized the Western
Union lines on his railroads. and let the
Western Union start the litigation. He
had influence with railroads he did not
control. Thus, the Pennsylvania railroad
had to be cnjoincd from summarily eject
ing the Western Union from its prop
cTty, as. in fact, it did twenty-five
years later, Finally, Mr.. Could had
ways Of fighting in the stock market.
He was a very canuv manipulation.
Western Union was a Vanderbilt stock,
well distributed even then among in
vestors, and TO attack Vanderbilt mt
that point was TO Nit him hard Mr.,
Could started Il bear campaign in West
ern Union. 1t was one of the spec
year 1850. The price of the stock de-
clincd from ll61a to nv. And at one
time Mr.. Gould was cornercd in if.
His Brokers Betrayed Him
After he had sold u great deal of
Western Union stock short, borrowing
ii for delivery as he sold IL, he disc0v-
cred one day that his brokers had be-
traycd ham. They had Informed Il
group of unattached spectators, among
them keenc and WOcriSholf2r, and.
making certain thai Mr.. Gould was sell
ing Western Union stock short. thcv
formed Il pool among them TO buy all
the stock hc might offer for sale BY
the time Mr. Gould learned of this theV
had lII, H.. hg1
stock than he could deliver, If the hold
ors of his contracts should call upon
mm together which was undoubtedly
what they intended 10 do. Mr. Could
anticipated them. "A called in his law.
ycrs and Instructed them 10 prepare
charge of conspiracy. Then he served
notice on those members Of The buvipNI
pool whom he iTcw thai me- proposed !
to move aganSt ihc" the ground Of |
conspiracy. They hr inspired with
his confidential broke put him in !
this hole
The effect was what ATr. Gould OK
pected. One member of the buying !
pool took fright and began 60 sell out F.
on his associates, Mir. Gould was not /
Il man with whom people went lightly |
10 law, As soon rs Mr.. Gould detected /
this selling he sent his brokers into !
The Western Union crowd with uuiiInit.
ed orders TO sell. There is, perhaps, no .
other instance Of such an order Ills |
brokers were instructed to soil as much .
As anybody would huy. until further
notice. This selling. combined with that
of the pool member who was secretly
getting out. caused tho market 10 col
lapse, and in mn hour the consprators
were IN full retreat
Ny. Could continued TO pound West,
'ru Union in the market, and the Amer.
cnn Union continued 10 pound the
Western Union in tho telegraph busi.
ness, At i point Mr.. Gouid turned
buyer of Western Union stock His \
,bject I'LL the while had been To do 60.
He had already n considerable interest
n the stock rs a result OF the At.
autic aud Pacific deal. Now he bought
'nough more 10 make himself nm import. ;
,nt factor in tho company, and con
lnued, as before. 10 antaGoni2e the
Western Union aggrcssivcIy through his
american Union. The Vanderbilt in.
ercsts, carly In 1881. capitulatcd. \
Ieal was copsummaJcd. In the second
week Of January Western Union stock
vent 10 100. The lighting was over aud
I remained TO perfect thc mcaus OF
.iyiuts OrOlifs