I am sure he believed he was brighter than most men on earth—a very dangerous thing to believe even if one
is
brighter than most men on earth. I am also sure his ruthlessness was in part intellectually based. For once he ascribed nothing to chance or luck; once he realized the limitations
of his reverend father, this meant that to be master of his own fate, he must do unsavoury things in order to succeed. For if you think of certain actions, seeing success as your only goal, and do not do them, more fool you!
Yet, if Max was ruthless, there wasn’t a parson in the world who could be more generous, even if they had the funds. There is a great story about him at Saint Mary’s Hospital in England. He was asked if he could help build a wing on this hospital. He went to visit and, while he was sitting in the cafeteria, he was approached by an elderly lady attendant. She told him that the tea and biscuits were a penny halfpence but, if he couldn’t afford it, she would give them to him free. Max was delighted, and wrote a cheque for £63,000 for the hospital wing.
CEMENT IS WHERE
he made his initial fortune—and where people who dealt with him say he stole it. Stole is a harsh word. Was he unethical? Most likely, he was—but was he really and truly dishonest? Probably no more so than his adversaries.
In 1909 his finances were basically secure. He was on a roll, and he had a name, even if it was a name that wouldn’t recommend him to each and all. (He was refused entrance into an exclusive Montreal business club that year, because of his bad reputation.)
He told his biographer, A.J.P. Taylor, that he set out to buy the English-language
Montreal Gazette
, for which he had once worked as a correspondent. Max said he was stopped by the Bank of Montreal and by the influential board members of the Canadian Pacific Railway, who did much business with the bank. Max was known as a young and brash Conservative financier and industrialist, untrustworthy, impetuous, and shamelessly given to acquiring companies for the purpose of monopoly and merger. This in itself is a psychological red flag to Canadians. The upshot of this was that the influential board of the CPR did not want unsavoury Conservative Max Aitken acquiring the only English-speaking newspaper in Montreal—at that time the one real city in Canada.
But then something very strange happened.
Soon after this event, that very same CPR board needed the merger insight of Max Aitken. Sir Edward Clouston, a man with a profile somewhat like the mustachioed villain in silent films, and president of the Bank of Montreal, enthusiastically put Max’s name forward.
So the board members approached Max Aitken, seeking out the same qualities they had rejected just a few months before. They had three cement companies, and they needed his ruthless efficiency to create a merger, which would generate sales, and to sell the stock to the public. As promoter
of this merger deal, he would be rewarded with a percentage of the profits from the shares sold.
He was asked by Sir Sandford Fleming, a member of the board of the Canadian Pacific Railway, himself. (Fleming, who would have been eighty at this time, had been the chief engineer in the building of our national railway, the “inventor” of Standard Time, and the main advocate for the telegraph cable between Canada and Australia. Now, late in life, he was to deal with another major challenge, Mr. Max Aitken. It is strange how fate sometimes plays out its hand.)
Yet, as Marchildon explains in his book
Profits and Politics
, there was a very serious devil in the details. Fleming was very close to bankruptcy, and was in a panic to save his reputation. This was something Max Aitken was not told. The price of cement was down, because of the economic crash of 1907, which Aitken had witnessed with alarm. Worse, Fleming’s partner in the Western Cement Company, a man named Irvin, had skimmed $500,000 as payment to himself from the company. Fleming had desperately borrowed funds from the Bank of Montreal against the value of the company, and petitioned the CPR for financial help. Now he owed them both hundreds of thousands. But he and Irvin realized that, with the low price of cement and lack of development, a merger of some
sort was required to save him. If anyone could pull it off, Max could.
At first the planned merger went well. But Max to his death insisted that he discovered a ruse. One company they wanted to float, Exshaw of Alberta, was bankrupt, and Fleming’s partner, Irvin, was also willing to skim money from any unwitting partners, like, as Marchidon states, a pyramid or Ponzi scheme, in which the people in control sell out to those coming in and reap the benefits, leaving the buyers with the debt. This was something Irvin didn’t think Max would discover.
As for Exshaw’s bankruptcy, Irvin and Fleming hoped to hide this. To keep the bankruptcy from the other cement companies who were joining the merger would be criminal. By its very nature, the merger was dishonest, and Max knew he would be singled out as the force behind a dishonest merger. This is probably why Clouston chose him.
So Max did something reckless and brilliant. He let other cement companies across Canada and in the States know that a great merger was taking place, which would regulate the price and the quality of cement. Over a few months he swamped the Fleming interests by bringing many of the cement companies in Canada into the mix, to create Canada Cement. Max made one of his own investment companies
the principal controller of the deal. He used Sandford Fleming’s name to give it respectability, while he dwarfed and marginalized the Fleming interests. Then, with Clouston’s help, he took over the monopoly himself.
But speaking on Aitken’s behalf, I have to say that Max’s wiliness does not automatically give Mr. Fleming or Mr. Irvin the sanctity of the higher moral ground.
Finding himself in a precarious position, Aitken had simply turned the tables on those who were prepared to use him. Once on a roll, and seeing a fabulous opportunity to control stock in cement companies that would help reinvigorate the industry, he became the ruthless executor of his own advantage. But is that a terrible thing for a businessman to do? Is it even illogical? Many contend he put the difference between the actual worth and the paper worth of the companies involved in the merger into his own pocket. Others say he bribed Clouston, giving a huge kickback to the president of the Bank of Montreal. My question is pragmatic, I know. Was he the only one who knew Sir Edward Clouston had that bad habit of taking kickbacks? Did any of the CPR board members, who had been acquainted with the president longer and at closer quarters, know? Had they used this flaw themselves, perhaps to stop Max’s other ventures, like the
Gazette
purchase
in 1909? Max, remember, was the one who was kept out of the business club in Montreal.
From this deal, Max ended up an exceedingly wealthy man. People felt that he had used the old man, Mr. Fleming, atrociously. Although the transactions remain murky on all sides, Fleming was never blamed and Aitken’s reputation would never recover.
But the lesson Max took from this cement caper was that he would always and forever be able to leapfrog over his opposition. This in some ways accounted for his erratic springboard approach to other great deals in his life.
They said he would not, could not, come back to Canada. Yet when you are a player of Aitken’s wiles, going to England in 1910, to the front row of Empire, who in hell would want to? But at any rate I saw him walking a street in Newcastle in 1958.
England then was not the England of today. When Max scampered onto its shores in 1910, his pockets already laden with cash, his abilities fine-tuned, it was still one of the great powers in the world. It was still the greatest empire, at its twilight to be sure, but nevertheless, secure in itself and in all things British. Tolstoy says in
War and Peace
that the assumption was “What was British was proper and right.”
A queen had sat on the throne for sixty years and had defined an age, its men and women travelled the globe, and its military still controlled a good part of it. Max Aitken came from one small part of that globe, but his allegiance in so many respects was to Britain, and, in fact, he was a British citizen. It is strange nowadays to think that a boy growing up in Newcastle, New Brunswick, could suddenly find himself running for the British House of Commons.
Ion Benn the British Unionist (Tory) said he was the one to get Max his seat, because he had seen his potential while on a visit to Montreal. It is not really true that he “got Max his
seat”—however, he did help him in many ways. He introduced him as a financier from Canada—and, more significantly, he clearly attached a value to this at a time when British financiers thought there was nothing valuable in Canada. As always, it is the fools who block the doors. But it was amazing with what relative ease Max Aitken went through the doors supposedly closed to him.
Max loved the Empire but over time would come to hate many of those who believed they owned it. This would become the principal difficulty in his life, and cause much trouble for him, morally and professionally. For he believed that he, a common boy from Newcastle, was as much a part of the Empire as they. That, in fact, was how the Empire promoted itself. Perhaps the least-known trait in Max was gullibility.
It is old-fashioned now, but then the Empire was lifeblood to many English-speaking Canadians, so it must have been a shock when many of the aristocracy tried to impede Aitken at every step. (It is equally amazing to me how many Canadians cheer that he was impeded.) The idea of him as an outsider would increase with his power and the hope his enemies had that he could be kept forever on the outside.
Tolstoy, in his famous observations on national conceit, said the British were conceited because they came from the
greatest Empire on earth, and therefore believed everything that they did must be proper and right. This was still true when Max was a young man. I am sure many British did not think of Canada as anything more than property they (supposedly) owned. How he must have butted his head against them, this colonial with money.
THE FIRST LETTER
of introduction he had to this rarified London was to a fellow New Brunswicker, Andrew Bonar Law. (Their museums are now fifty miles apart in the province of New Brunswick.) Bonar Law was born in Rexton, New Brunswick, in l858, and moved to Scotland when he was sixteen, after his mother’s death, to find employment with his family’s ironworks. By the time Max arrived, he was a well-established sitting member of the Conservative Party, having first represented Glasgow-Blackfriars and then Dulwich. In pictures he looks a little, at least to me, like Joseph Conrad, who would recently have published
The Secret Agent
, a strangely comic master-piece that shows a darker aspect of the seething temper of the times.
Law was cool to Max (coming from the opposite side of the Scottish Religious question) and Max felt Law could never succeed because of the “shape of his head”—perhaps the
strangest and most comic of all the strange and sometimes comic beliefs Max the pragmatist had. But Law was not immune to the young man’s sales ability, and he bought five hundred shares of a stock Max was selling. Max was always selling, and when he went to England the main thing he was selling was himself, wrapped up as manna from Canada. He sold himself the same way as he sold eggs from his hens, or Bennett in Chatham—with too much sauce and not enough meat. You can imagine casually inviting him to visit you at some time in the future, only to discover him standing at your door at eight o’clock the next morning. In fact, Bonar Law once actually had the door locked against him, just like many others before and some after. But he let Max back in—just like many others before and some after.
It did show his ability to keep them, or at least himself, enthused.
Of course, meeting Bonar Law, the boy from Rexton, New Brunswick, who was to become prime minister of Great Britain in 1922, was a pivotal event in Max Aitken’s life. Bonar Law would become another older man who would string a tightrope and watch how the little Newcastle imp could don a top hat and twirl a cane while perched upon it.
In fact the friendship between these two New Brunswickers would shape the next twelve years of British politics, first
within the ranks of the British Conservative Party and then within the office of the prime minister itself.
It is strange how quickly our man got on in Britain. One forgets that, as a British citizen, and as a millionaire, and with introductions to Bonar Law and other expatriate Canadians, Max Aitken had inroads already ploughed. And amid all this glitter—Henry James was still writing, George V was ascending the throne, young (or youngish) Churchill was conniving for power, there were parties in tuxes and dinner at the club—he must have thought he had landed at the top of the world. In a way he had. It was the London of Piccadilly Circus and Trafalgar Square, of London Bridge and the Thames, of Henry VIII and Elizabeth I, of Chaucer, Shakespeare, and Marlowe, of eighteenth-century scribblers like Sam Johnson and nineteenth-century icons like Charles Dickens, and of political men of only a generation before, like Disraeli and Gladstone. Max, too, wanted to climb to the top of the greasy pole—he was too certain of his destiny not to—but it’s hard to know if he wanted the prime ministership. If he had thought Saint John, New Brunswick, was awe-inspiring when he was a boy, look what he’d gotten up to now!
He would never take up permanent residence in Canada again (though on three occasions he would try). He was one
of the casualties, not of the cement shenanigans back home (or not just that) so much as of Canada’s inability to set a course for itself and keep its brightest and most influential citizens Canadian. In a sense Max was like Canadian silentfilm icon Mary Pickford, or fellow New Brunswickers Louis B. Mayer, co-founder of MGM (who was born in Russia but educated in New Brunswick) and 1940s actor Walter Pigeon, or later still, Saint John–born Donald Sutherland. He, like they, had to go where there would be a reasonable chance of becoming a star. However, he would be blamed for this “flaw” of being Canadian—in Britain far more than they were in the States. And Canada and Canadians have treated the memories of these film stars with a reverence our pugnacious newspaper baron never managed to corral. Yet there was no Canadian of the century more influential. Perhaps in a way (shudder to think), a saviour of our way of life. Why is this not remembered? Why is our whole contribution to the world thrown off a cliff to oblivion, and none of us dare say shame?