ition and thought that Morgan might be
quietly attempting to secure the property. Morgan, however, was not
interested. The mystery was still unsolved.

The fact was that Edward H. Harriman, who for some years past had been
a powerful influence in the affairs of the Illinois Central Railroad but
who was unknown to the average Wall Street promoter and totally unheard
of throughout the country, had made up his mind to reorganize the
Union Pacific Railroad. He therefore began to work quietly with various
interests in an attempt to tie up the property. But soon he, like
Schiff, encountered serious opposition. He also immediately jumped to
the conclusion that Morgan was secretly at work, and he called on Morgan
for the facts. Morgan replied, as he had replied to Schiff, that he was
not interested, but that he wished Harriman success.

As Schiff continued to meet with difficulty, he soon called on Morgan
again. Again Morgan replied that he was not interested. "But," he said,
"I think if you will go and see a chap named E. H. Harriman you may find
out something."

Who was Harriman? Schiff had hardly heard of him and had never met him.
How could a small man like Harriman, with no money, no powerful friends,
no big financial backing, reorganize a great system like the Union
Pacific Railroad? The idea seemed ridiculous. Nevertheless, as the
opposition continued, Schiff soon got in touch with Harriman. In the
course of a conference, he warned this daring interloper to keep his
hands off the Union Pacific. But Harriman was not moved by threats. On
the contrary, he insisted that Schiff should leave the Union Pacific
alone; that he himself had already worked out his plans to reorganize
it. Schiff laughed at this idea, termed it chimerical, and asserted that
Kuhn, Loeb and Company were easily able to obtain the needed one hundred
millions or more through their foreign connections on a basis of from
four to five per cent, and that in America no such sum of new capital
could at that time be raised through banking activities at better than
six or seven per cent.

Harriman then sprang his surprise on Schiff. For some years he had been
financially interested in the affairs of the Illinois Central. This
property had at that time higher credit than any other American
railroad; it had raised large sums of capital in Europe on as low a
basis as three per cent, and on most of its bonds paid only three and
one-half per cent interest. For near