As a matter of fact, I had no such feeling. I had been carefully studying the question. I had talked with the Mutual Life and Equitable people about it, but was not committed to any particular course, and had grave doubts as to whether it was well to draw the line on size instead of on conduct. I was therefore very glad to see Perkins and get a new point of view. I went over the matter with a great deal of care and at considerable length, and after we had thrashed the matter out pretty fully and Perkins had laid before me in detail the methods employed by Austria, Germany, Switzerland, and other European countries to handle their large insurance companies, I took the position that there undoubtedly were evils in the insurance business, but that they did not consist in insuring people’s lives, for that certainly was not an evil; and I did not see how the real evils could be eradicated by limiting or suppressing a company’s ability to protect an additional number of lives with insurance. I therefore announced that I would not favor a bill that limited volume of business, and would not sign it if it were passed; but that I favored legislation that would make it impossible to place, through agents, policies that were ambiguous and misleading, or to pay exorbitant prices to agents for business, or to invest policyholders’ money in improper securities, or to give power to officers to use the company’s funds for their own personal profit. In reaching this determination I was helped by Mr. Loeb, then merely a stenographer in my office, but who had already attracted my attention both by his efficiency and by his loyalty to his former employers, who were for the most part my political opponents. Mr. Loeb gave me much information about various improper practices in the insurance business. I began to gather data on the subject, with the intention of bringing about corrective legislation, for at that time I expected to continue in office as Governor. But in a few weeks I was nominated as Vice President, and my successor did nothing about the matter.
So far as I remember, this was the first time the question of correcting evils in a business by limiting the volume of business to be done was ever presented to me, and my decision in the matter was on all fours with the position I have always since taken when any similar principle was involved. At the time when I made my decision about the Limitation Bill, I was on friendly terms with the Mutual and Equitable people who were back of it, whereas I did not know Mr. McCall at all, and Mr. Perkins only from hearing him discuss the bill.
An interesting feature of the matter developed subsequently. Five years later, after the insurance investigations took place, the Mutual Life strongly urged the passage of a Limitation Bill, and, because of the popular feeling developed by the exposure of the improper practices of the companies, this bill was generally approved. Governor Hughes adopted the suggestion, such a bill was passed by the Legislature, and Governor Hughes signed it. This bill caused the three great New York companies to reduce markedly the volume of business they were doing; it threw a great many agents out of employment, and materially curtailed the foreign business of the companies—which business was bringing annually a considerable sum of money to this country for investment. In short, the experiment worked so badly that before Governor Hughes went out of office one of the very last bills he signed was one that permitted the life insurance companies to increase their business each year by an amount representing a certain percentage of the business they had previously done. This in practice, within a few years, practically annulled the Limitation Bill that had been previously passed. The experiment of limiting the size of business, of legislating against it merely because it was big, had been tried, and had failed so completely that the authors of the bill had themselves in effect repealed it. My action in refusing to try the experiment had been completely justified.
As a sequel to this incident I got Mr. Perkins to serve on the Palisade Park Commission. At the time I was taking active part in the effort to save the Palisades from vandalism and destruction by getting the States of New York and New Jersey jointly to include them in a public park. It is not easy to get a responsible and capable man of business to undertake such a task, which is unpaid, which calls on his part for an immense expenditure of time, money, and energy, which offers no reward of any kind, and which entails the certainty of abuse and misrepresentation. Mr. Perkins accepted the position, and has filled it for the last thirteen years, doing as disinterested, efficient, and useful a bit of public service as any man in the State has done throughout these thirteen years.
The case of most importance in which I clashed with Senator Platt related to a matter of fundamental governmental policy, and was the first step I ever took toward bringing big corporations under effective governmental control. In this case I had to fight the Democratic machine as well as the Republican machine, for Senator Hill and Senator Platt were equally opposed to my action, and the big corporation men, the big businessmen back of both of them, took precisely the same view of these matters without regard to their party feelings on other
