this, the stronger lines
bought or leased the weaker, with which they might not cooperate, but
which they might buy outright. Harriman, successful with his
Southwestern system, tried in 1901 to buy the Northern Pacific, too, and
came into direct conflict with another group of railway owners.

The Northern Pacific had been supplemented after 1893 by the Great
Northern, which James J. Hill had built without a subsidy. These two
roads, and the Chicago, Burlington & Quincy, covered the Northwest as
Harriman's lines covered the Southwest. They were so placed that with
common management they could be more effective than with rivalry. The
owners of the Great Northern and the Burlington, James J. Hill and J.
Pierpont Morgan, were on the verge of a general consolidation when
Harriman tried to buy a control of the Northern Pacific. They struggled
to retain it and succeeded, but their competition raised its stock to
one thousand per share, causing a stock exchange panic on May 9, 1901.
Only the speculators suffered by the panic, but public attention was
drawn by it to the gigantic size of the combinations which held
arbitrary control over nearly half the United States.

Minor consolidations followed these in 1902 and 1903, but none aroused
so much fear as the Northern Securities Company of New Jersey, the
holding company in whose hands Hill and Morgan determined to put the
control of their lines. The fate of any single company could be
determined by the ownership of not over fifty-one per cent of its stock.
If this was owned by another corporation, a similar proportion of the
stock of the latter would control the whole. The holding company was a
machine whereby capital could control property several times its bulk.
The Governors of the Northwest States, alarmed at the monopolization of
their railways, protested and started suits. It was claimed that this
sort of merging of railroads was, after all, a conspiracy in restraint
of trade. In March, 1902, President Roosevelt instructed his
Attorney-General, Philander C. Knox, to test the Sherman Act of 1890,
and bring suit under it for the dissolution of the Northern Securities
Company. For several years after 1897 foreign affairs and big business
had been dominant in the American mind, which had admired their bigness
and activity, but now the social consequences of big business aroused
the fears of the nation. In 1903 Congress passed the Elkins Law,
forbidding railroads to give rebat