“Muckraking in the Garden,” is about the turn of the twentieth century investigative reporter whom President Theodore Roosevelt called a “muckraker,” Lincoln Steffens, who described New Jersey as “A Traitor State.” He did so because New...
more“Muckraking in the Garden,” is about the turn of the twentieth century investigative reporter whom President Theodore Roosevelt called a “muckraker,” Lincoln Steffens, who described New Jersey as “A Traitor State.” He did so because New Jersey had passed in the nineteenth century “general corporation” laws
that enabled corporate trusts to flourish in the state. The irony wasthat these laws were proposed as reform measures replacing specialstate charters to corporations with special privileges, such as theSociety for Establishing Useful Manufactures and the Joint Companies(the merger of the Camden and Amboy Railroad with the Delawareand Raritan Canal). The control that the Joint Companies had over the state legislature resulted in New Jersey being called “the State of Camden and Amboy.”
Until the 1870s the main source of revenue for the state was the so-called “transit duties” paid by out -of-state passengers traveling onand businesses shipping goods on New Jersey railroads. In 1875 NewJersey increased the fees paid to the state for chartering corporations,including corporate trusts. In 1882 John D. Rockefeller, who hadstarted Standard Oil as a corporation in Ohio, charted the Standard Oilof New Jersey to construct a refinery in Hoboken. In 1892 a court inOhio forced the 20 corporations that constituted Standard Oil toreorganize, and in 1899 New Jersey permitted Standard Oil of NewJersey to become a holding company of what was then a total of 33companies. In 1909 Standard Oil built its Bayway Refinery in Elizabeththat everyone traveling on the New Jersey Turnpike today can see (and smell). It wasn’t until 1911 that the United States Supreme Court broke up Standard Oil of New Jersey as a trust under the ShermanAnti-Trust Act.
In addition to attacking New Jersey ’s general corporation law,
Steffens exposed the power of public utility companies in the state.The larges was the Public Service Corporation, founded in 1903, withthe financial backing of the Prudential Insurance Company and theFidelity Union Trust Company, both of Newark, New Jersey. Under itspresident Thomas McCarter, Public Service bought up various gaslighting and electrical generating companies, including electric trolleys,throughout the state. The president of Prudential Insurance, John F. Dryden, was appointed by the state legislature to the United States Senate in the days before the direct election of senators. McCarter’s brother, Robert McCarter, was the New Jersey attorney general. Steffens concluded that the New Jersey legislature “is owned by the Public Service and Railroad lobbies.” On the other hand, he noted that 78 percent of the revenues for the state came from railroad and other business taxes.mas
Lesser known, but equally important, were water utilities, suchas Elizabethtown Water Company, founded in 1854 in by a small groupof investors, including Colonel John Kean, whose grandfather hadmarried Susan Livingston, the daughter of William Livingston, the firstgovernor of the State of New Jersey. Between 1869 and 1905 Elizabethtown Water Company bought out seven smaller watercompanies between Elizabethtown and Somerville, including the Middlesex Water Company. Colonel John Kean’s two sons went intopolitics: John Kean, who represented New Jersey
in the U.S. Senate from 1899 to 1911 and served two separate terms in the House of Representativesfrom 1883 to 1885 and from 1887 to 1889, and Hamilton Fish Kean, who served in the United States Senate from 1928 to 1934.
After his muckraking articles about New Jersey Steffens decided to write a more positive story about the so-called “New Idea” Republicans who were the precursors of the Progressives in seeking to reform politics in the state. He profiled Mark Fagan, the Irish mayor of Jersey City elected in 1901,who fought the combined forces of the political boss Bob Davis and the banker E. F. C. Young. At that time the Pennsylvania Railroad owned much of the Jersey City waterfront, and Public Service owned the trolleys. Neither paid their fair share of taxes to Jersey City. MayorFagan attempted to contest the re-chartering of the trolley franchise
and “equalize” the taxes paid by the railroad. However, the “New Idea” Republicans didn’t last long in office. They were defeated in local and state elections in 1906, and the reform banner in the state was laterpicked up by Woodrow Wilson and the Democratic Party in thefollowing decade. One of the measures that Wilson was able to getthrough the state legislature in 1911 was an act to establish a public utilities commission to regulate companies like Public Service Electric and Gas and Elizabethtown Water.