Enter In Teddy Roosevelt

Roosevelt’s early career showed him to be a dynamic leader with a Progressive agenda. Many Republican Party leaders disliked Roosevelt’s Progressive ideas and popular appeal and hoped to end his career with a nomination to the vice presidency—long considered a dead end in politics. When an assassin’s bullet toppled this scheme, Mark Hanna, a prominent Republican senator and party leader, lamented, “Now look! That damned cowboy is now president!”

As the new president, however, Roosevelt moved cautiously with his agenda while he finished out McKinley’s term. Roosevelt kept much of McKinley’s cabinet intact, and his initial message to Congress gave only one overriding Progressive goal for his presidency: to eliminate business trusts. In the three years prior to Roosevelt’s presidency, the nation had witnessed a wave of mergers and the creation of mega-corporations. To counter this trend, Roosevelt created the Department of Commerce and Labor in 1903, which included the Bureau of Corporations, whose job it was to investigate trusts. He also asked the Department of Justice to resume prosecutions under the Sherman Antitrust Act of 1890. Intended to empower federal prosecutors to ban monopolies as conspiracies against interstate trade, the law had run afoul of a conservative Supreme Court.

Busting the Trusts

Aggression against the trusts—and the progressive vogue for “trust-busting”—took on new meaning under the presidency of Theodore Roosevelt. Roosevelt was by no means anti-business. Instead, he envisioned his presidency as a mediator between opposing forces, such as between labor unions and corporate executives. Despite his own wealthy background, Roosevelt pushed for antitrust legislation and regulations, arguing that the courts could not be relied on to break up the trusts. Roosevelt also used his own moral judgment to determine which monopolies he would pursue. Roosevelt believed that there were good and bad trusts, necessary monopolies, and corrupt ones. Although his reputation as a trustbuster was wildly exaggerated, he was the first major national politician to go after the trusts. “The great corporations which we have grown to speak of rather loosely as trusts,” he said, “are the creatures of the State, and the State not only has the right to control them, but it is in duty bound to control them wherever the need of such control is shown.”

In 1902, Roosevelt launched his administration’s first antitrust suit against the Northern Securities Trust Company, which included powerful businessmen, like John D. Rockefeller and J. P. Morgan, and controlled many of the large midwestern railroads. Holding trusts had emerged as a way to circumvent the Sherman Anti-Trust Act: by controlling the majority of shares, rather than the principal, Morgan and his collaborators tried to claim that their enterprise was not a monopoly. The suit wound through the judicial system, all the way to the U.S. Supreme Court. In 1904, the highest court in the land ultimately affirmed the ruling to break up the trust in a narrow five-to-four vote. For Roosevelt, that was enough of a mandate; he immediately moved against other corporations, including the American Tobacco Company and, most significantly, Rockefeller’s Standard Oil Company. Two years later, in 1906, Roosevelt signed the Hepburn Act, allowing the Interstate Commerce Commission to regulate best practices and set reasonable rates for the railroads.

Although Roosevelt enjoyed the nickname “the Trustbuster,” he did not consider all trusts dangerous to the public welfare. The “good trusts,” Roosevelt reasoned, used their power in the marketplace and economies of scale to deliver goods and services to customers more cheaply. For example, he allowed Morgan’s U.S. Steel Corporation to continue its operations and let it take over smaller steel companies. At the same time, Roosevelt used the presidency as a “bully pulpit” from which to publicly denounce “bad trusts”—those corporations that exploited their market positions for short-term gains—before he ordered prosecutions by the Justice Department. In total, Roosevelt initiated over two dozen successful anti-trust suits, more than any president before him.

Roosevelt confronted the power of big business in other instances. When an anthracite coal strike gripped the nation for much of 1902, Roosevelt directly intervened in the dispute and invited both sides to the White House to negotiate a deal that included minor wage increases and a slight improvement in working hours. For Roosevelt, his assistance in the matter symbolized his belief that the federal government should adopt a more proactive role and serve as a steward of all Americans. This stood in contrast to his predecessors, who had time and again bolstered industrialists in their fight against workers’ rights with the deployment of federal troops.

Roosevelt was more interested in regulating corporations than breaking them apart. Besides, the courts were slow and unpredictable. However, his successor after 1908, William Howard Taft, firmly believed in court-oriented trust-busting and during his four years in office more than doubled the number of monopoly breakups that occurred during Roosevelt’s seven years in office. Taft notably went after U.S. Steel, the world’s first billion-dollar corporation formed from the consolidation of nearly every major American steel producer.

The Square Deal

Roosevelt won his second term in 1904 with an overwhelming 57 percent of the popular vote. After the election, he moved quickly to enact his own brand of Progressivism, which he called a Square Deal for the American people.

The Square Deal reflected Roosevelt’s three major domestic goals: control of corporations, consumer protection, and the conservation of natural resources. These three demands are often referred to as the “three Cs” of Roosevelt’s Square Deal. Thus, the Square Deal aimed at helping middle-class citizens and involved attacking plutocracy and bad trusts while at the same time protecting business from the most extreme demands of organized labor. He explained in 1901–1909: “When I say that I am for the square deal, I mean not merely that I stand for fair play under the present rules of the game, but that I stand for having those rules changed so as to work for a more substantial equality of opportunity and of reward for equally good service.”^[1] We already learned about his efforts in controlling corporations and breaking up monopolies, below we will learn about some of the consumer protections implemented under Roosevelt, and the next page further explains his efforts to conserve natural resources.

Consumer Protection

Early in his second term, Roosevelt read muckraker Upton Sinclair’s 1905 novel and exposé on the meatpacking industry, The Jungle. Although Roosevelt initially questioned the book due to Sinclair’s professed Socialist leanings, a subsequent presidential commission investigated the industry and corroborated the deplorable conditions under which Chicago’s meatpackers processed meats for American consumers. Alarmed by the results and under pressure from an outraged public disgusted with the revelations, Roosevelt moved quickly to protect public health. He urged the passage of two laws to do so.

The first, the Meat Inspection Act of 1906, established a system of government inspection for meat products, including grading the meat based on its quality. This standard was also used for imported meats. The second was the Pure Food and Drug Act of 1906, which required labels on all food and drug products that clearly stated the materials in the product. The law also prohibited any “adulterated” products, a measure aimed at some specific, unhealthy food preservatives.

In his second term in office, Roosevelt signed legislation on Progressive issues such as factory inspections, child labor, and business regulation. He urged the passage of the Elkins Act of 1903 and the Hepburn Act of 1906, both of which strengthened the position of the Interstate Commerce Commission to regulate railroad prices. These laws also extended the Commission’s authority to regulate interstate transportation on bridges, ferries, and even oil pipelines.