California Rich
The Lives, the Times, the Scandals and the Fortunes of the Men & Women Who Made and Kept California’s Wealth
Stephen Birmingham
For Carol Brandt
Contents
PROLOGUE
THE GILDED MAN
PART ONE
THE SEED MONEY
CHAPTER ONE
Liquid Gold
CHAPTER TWO
Grants and Grabs
CHAPTER THREE
The Big Four
CHAPTER FOUR
How to Buy a King
CHAPTER FIVE
Chronicle of Power
CHAPTER SIX
The Great Museum War
CHAPTER SEVEN
Silver Kings and Other Royalty
CHAPTER EIGHT
Disasters, Natural and Unnatural
PART TWO
THE EASY SPENDERS
CHAPTER NINE
Throwing It Around
CHAPTER TEN
Prince and Pauper
CHAPTER ELEVEN
Wedding Bells
CHAPTER TWELVE
Mother and Children
CHAPTER THIRTEEN
Tempest About a Teapot
CHAPTER FOURTEEN
Final Curtains
CHAPTER FIFTEEN
Scandals
PART THREE
BLOOD AND WATER
CHAPTER SIXTEEN
J.I.’s Land
CHAPTER SEVENTEEN
Tough Lady
CHAPTER EIGHTEEN
End of the Battle
CHAPTER NINETEEN
Overnight Tradition
CHAPTER TWENTY
“Valley People”
CHAPTER TWENTY-ONE
O Little Town
CHAPTER TWENTY-TWO
Finisterra
POSTSCRIPT
FURTHER ON
CHAPTER TWENTY-THREE
The Gilded Nomads
IMAGE GALLERY
BIBLIOGRAPHY
INDEX
ACKNOWLEDGEMENTS
PROLOGUE
THE GILDED MAN
Californians are a race of
people; they are not merely
inhabitants of a State.
O. HENRY
For years Texas has laid proprietary—and quite undeserved—claim to everything American that pertains to bigness. Compared with California, however, Texas can boast only the larger acreage. Everything else about California is much, much bigger. And what is astonishing about California’s bigness is that it all came about in a little over three generations’ time. Never in history have so few men, who started out with so little, made so much out of a place that seemed to offer so little to begin with.
Consider California as recently as 1850, when the fledgling state had a population slightly larger than the nontransient population of present-day Bermuda—about ninety thousand. By 1880 the state’s population was nearly a million, and thirty years later the figure was approaching two and a half million. Today, with a population of over twenty-two million, our most populous state contains more people than modern Afghanistan, and the city of Los Angeles alone is bigger than Dallas, Fort Worth, and Houston combined. And the end is not in sight.
At the same time, one of the difficulties of coming to grips with California, with its wealth, what it is and what it means, is that one is dealing with an ancient, romantic dream, along with a generally accepted fact of modern life, which is that dreams and reality almost never mesh. In reality, the success of California was based on plunder, thievery, bloodshed, and other familiar forms of physical, emotional, and economic violence. In the process the tinker’s son became a great landowner, the preacher’s son an oil tycoon, the butcher’s son a cattle baron, and the glove salesman became Samuel Goldwyn of Hollywood.
The dream was all quite different, and much prettier, and much older than any of California’s great fortunes, which, by comparison, sprang up only yesterday. It was a dream of El Dorado—literally, in Spanish, “The Gilded Man.” Few people realize that El Dorado was originally a person, not a place. He was said to be the king, or the highest of the high priests, of a South American tribe of Indians, whose city-kingdom was thought to exist somewhere along the Pacific Coast—not far, so the legend went, from Santa Fe de Bogatá. No one knows exactly how the tales of El Dorado started, but stories about him spread and flourished throughout the Middle Ages. The kingdom that El Dorado ruled was said to be rich beyond mankind’s wildest dreams; it had to be, because once a year, at his principal religious festival, El Dorado covered his naked body completely with a shower of gold dust.
Gradually El Dorado began to be interpreted as a city, whose name was variously given as Manoa and Omoa. But about the exact location of this city of gold there was much dispute. Finally it began to be assumed that El Dorado was much more than a city, that it was, in fact, an entire country where gold and precious jewels could be found in great abundance. By the time of the sixteenth-century Spanish explorers and conquistadors, the existence of El Dorado was taken very seriously, and a number of men received substantial financial backing to set out to find it. The only thing that anyone seemed certain of was that El Dorado lay in some tropical or semitropical climate—pleasant weather seemed an appropriate requisite for such a dream—and South America continued to seem the likely region.
One of the most celebrated searches for El Dorado was led by Diego de Ordaz. And in 1531 one of his lieutenants, Martínez, reported success. As he told the story, he had been rescued from a shipwreck by a band of tall, powerful, and richly dressed Indian warriors, who had led him inland to the city of Omoa. There, Señor Martínez related, he had been lavishly housed and entertained by none other than El Dorado himself. He had witnessed the rite in which El Dorado showered himself with gold dust—of which there was a vast abundance in Omoa—and he had seen and touched the diamonds, emeralds, rubies, sapphires, and pearls with which El Dorado’s coffers overflowed.
Of course Martínez was lying through his teeth, but there was no one to challenge his assertions, and so others set off to try to find the wondrous place where he had been. Their object was to accomplish what Martínez had failed to do—to conquer El Dorado.
There were the various journeys, for example, in 1540 and 1541, of Orellana, who searched for El Dorado along the Rio Napo and into the valley of the Amazon, and from 1541 to 1545 of the German explorer Philipp von Hutten, who led a party from Coro to the coast of Caracas. Neither of these men was successful, nor was Gonzalo Jiménez de Quesada, in 1569, who started in the place where the legend appeared to have started, in Santa Fe de Bogotá.
In 1595 the English adventurer Sir Walter Raleigh, backed by Queen Elizabeth, took up the search and soon demonstrated that, despite his reputation for chivalry, he was no more truthful than Martínez. He too claimed to have found the fabled city. However, he pointed out, it was called Manoa, not Omoa, and he located it exactly on the shores of Lake Parimá, in Guiana. So seriously was Raleigh’s discovery taken that the city and the lake were dutifully marked on English and other maps of South America for the next two hundred years. It was not until the nineteenth century that an explorer named Von Humboldt proved that there was no such city in Guiana, and, furthermore, no such lake.
In the meantime El Dorado had become a synonym for any distant, elusive place where great riches could be accumulated very quickly. Because the legend of The Gilded Man persisted, it was supposed that he had also discovered the secret of immortality, and the search for El Dorado became confused with the search for the Fountain of Youth and for other impossible places, such as the lost city of Atlantis. El Dorado began to symbolize one of mankind’s oldest grails: a life of riches and pl
easures, without work and without care, in a land of perpetual youth and sunshine.
One can imagine the excitement, therefore, when as recently as the mid-nineteenth century great veins of gold were discovered in a place no one had paid much attention to—California, where the peaceful, agricultural, basket-making native Indians were not dangerous or even particularly interesting. It seemed as if El Dorado had at last been found. In the Sierra foothills, east of Sacramento, where some of the first placer mines were dug, a county was triumphantly named El Dorado, and its county seat was christened Placerville. Glorious futures for Placerville and El Dorado County were envisioned.
Placerville today is not much of a place; it has a bawdy house or two, popular with the military personnel stationed in the area. And, indeed, El Dorado County does not have much to offer except mountain scenery. Because California was no more an El Dorado than any other of the mythical places where it was claimed to be. And yet the myth of California as El Dorado is special in that is has continued, no matter how many times it has been disproved. The gold rush came, and went, and still more people came. In the years since, millions have come to California in search of easy riches, youth, an easy life. And, to be sure, a number have found at least some of these treasures. So they continue to come, as the dream of El Dorado goes on exerting its golden lure.
Perhaps it always will, in spite of the fact that the California dream is always being rudely shattered by the reality that great riches do not solve all life’s problems, that, in fact, El Dorado’s rewards are also bitterness, hatred, murder, despoliation, and disillusion. For every fortune made in El Dorado, it seems, there is also a heavy price.
But that reality has been unable to kill the dream; the California dream goes on. After all, California put the fabulous El Dorado on a legitimate map, and so California keeps getting bigger. Los Angeles, a sleepy backwater as recently as 1920, now threatens to eclipse Chicago and New York in size and become the nation’s largest city. Already it is difficult to tell where Los Angeles ends and the next big city, Long Beach, begins. They come in jet planes and in vans and pickup trucks, all absolutely convinced that there are riches here, that there is a pot of gold at the end of the long California rainbow.
And perhaps there is.
PART ONE
THE SEED MONEY
CHAPTER ONE
Liquid Gold
California, it has been pointed out, has never, for all its riches, produced a fortune to equal the riches amassed in the East by such men as John D. Rockefeller, Jay Gould, and E. H. Harriman. Perhaps this is because in the 1850s and 1860s, when Rockefeller was putting together the Standard Oil Company, California was still too new and inexperienced a place to contain more than one get-rich enthusiasm at a time, and the enthusiasm of the moment, of course, was gold. The California gold fortunes had a way of being lost rather quickly, though the men who followed the prospectors—the speculators and con men, the supply merchants, the gamblers, the saloonkeepers and madams—did somewhat better. In the 1850s some quarter of a million Americans thronged across the valleys and mountains of California in search of gold-rush wealth, ignoring the black viscous substance that squished beneath their feet, the substance that was making Rockefeller rich.
It lay all about, in pools and open pits and puddles. It oozed from canyonsides. The coastal Indians had been making use of the sticky stuff for generations. They used it to waterproof their woven baskets, to caulk the bottoms of their canoes, and as a sealant to make containers of food both air-and watertight. They had also learned that when swallowed, it made an excellent if not very tasty purgative, that rubbed on the skin it made a soothing balm for cuts and burns, and that it could itself be burned for heat and light. The coastal tribes traded their brea, or tar, with tribes of the interior for spearheads and furs. The first Spanish settlers were puzzled by the tar pits. Arriving in Upper California from Mexico in 1769 with Don Gaspar de Portolá and Fra Junípero Serra—whose orders from Carlos III were to oust the Jesuits from the missions and replace them with Franciscans—the Spaniards concluded that the tar pits perhaps caused the earthquakes and were somehow connected with volcanoes in the distant mountains. Though the black substance was cool to the touch, it was assumed to be some form of molten rock.
In 1855, taking their cue from the Indians, the Mexican General Andrés Pico and his nephew, Rómulo, had begun in a modest way to market the crude oil they scooped up from pits in a canyon north of the San Fernando Mission. General Pico was the brother of Pio Pico, the last Mexican governor of California, and was a fallen hero of the Mexican War—he had defeated the American General Stephen Kearney in 1847, but had later been forced to surrender to General John C. Frémont. The Picos peddled their “coal oil” as a medicine, as a lubricant for squeaky oxcart axles, and as a cheaper—and much smokier and smellier—substitute for whale oil in lamps. (Whale oil could then only be afforded by the well-to-do; the very poor went to bed when the sun went down.) To the gold and silver prospectors, meanwhile, the oil was simply a nuisance. It seeped into streams and rivers and polluted their drinking water.
In 1857 a former New York sperm-oil dealer named George S. Gilbert built a primitive oil refinery near the Ventura Mission. In order to reduce his oil to axle grease, which he hoped to market, he boiled the oil, and, in the process, the vaporous fumes of what would one day fuel the automobile industry escaped into the blue California sky. One of Mr. Gilbert’s first sales that year was a consignment of a hundred kegs of grease to one Mr. A. C. Ferris of Brooklyn, New York. Alas, the heavy burden of Gilbert’s oil was too much for the mule teams assigned to carry it across the Isthmus of Panama. The hundred kegs were jettisoned somewhere in the jungle. If Mr. Gilbert’s oil had reached its intended destination, the birthplace of the oil industry might have been southern California instead of Titusville, Pennsylvania, where, that same year, a blacksmith named Uncle Billy Smith dug a hole in the ground that became America’s first oil well. Within two years the great Pennsylvania oil stampede had begun and the desolate little farm community of Titusville had become a boomtown. And down from Cleveland, less than a hundred and fifty miles away, young John D. Rockefeller was already on hand.
It was not until April 1892 that the California oil industry was ready for a man named Edward L. Doheny. Ed Doheny was a most unlikely character to signal such a momentous event. He had been born in 1856 in Fond du Lac, Wisconsin, the son of a poor Irish immigrant who had fled from the great potato famine of the 1840s and had headed westward lured by the siren song of riches. The senior Doheny, however, had never found them, and at age sixteen his son had run away from home. Ed Doheny had worked variously as a booking agent, a fruit packer, a mule driver, and as a singing waiter at the Occidental Hotel in Wichita, Kansas, where he also picked up bits of change acting as a procurer of young ladies for the traveling drummers who passed through town. At the age of eighteen he embarked on what was to be his lifelong occupation—searching for wealth underground—and become a gold prospector.
For the next few years Ed Doheny was a man without a permanent address, and the chronology of his wanderings is unclear. He is known to have spent time in Texas, Arizona, New Mexico, and Mexico, sometimes making a small strike, sometimes going broke. During these years he acquired a reputation in prospecting circles that was unsavory, not to say dangerous. The sheriff of Laredo in 1878 described the passage through that town of one “E. Dohenny [sic] a rough character.” Doheny had early learned to use a gun and was quick to reach for his holster in tough situations. It was rumored that he had once killed a man—or possibly several. He seems to have been a man able to adapt himself easily to one side of the law or the other as he moved through the one-street towns of the Southwest, and in New Mexico, Doheny was known as the man who had cleared the little town of Kingston of local cattle thieves and bad men. One of these was said to have fired sixteen bullets at Doheny before Doheny was able to overpower and disarm him. As a prospector, however, he employed more mystical methods,
and for a long time his principal mining tool was a divining rod. When the rod quivered and dipped in his hand, Doheny stopped on the spot and began digging for gold, occasionally finding some but usually not.
He was thirty-six years old in 1892 when he arrived in the still-raw California town that had been dedicated to Nuestra Señora de Los Angeles, and his prospects for discovering a real bonanza had begun to look exceptionally dim. He was still rawboned and fast on the draw, but youth was slipping away. His mining adventures in Arizona and New Mexico had all been failures and he was virtually penniless. But then one of those queer strokes of incredible luck that have marked the beginnings of so many American fortunes came to Ed Doheny. Passing in the street one day he noticed a black man driving a horse and wagonload of black, steaming, tarry stuff. Doheny asked the man what the substance was, and was told that it was brea, and that it bubbled from a pit on the edge of town, and that the poorer families of Los Angeles collected it without charge and used it for fuel.
From his diggings around the West, Doheny knew even without his divining rod that the brea was crude oil, and set off to investigate the bubbling pit. He located it in Hancock Park, decided that it looked promising, and with a small amount of hastily borrowed cash, leased the land. Because he could not afford to buy or lease a drill, Doheny dug by hand with a pick and shovel, arduously extending a four-by-six-foot shaft into the ground. At a depth of 460 feet he was able to dip up four barrels a day. The deeper he went the more oil came up, and within a few months he had brought in the first real gusher in California.
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