The First Tycoon

by T. J. Stiles

20 Beckert, 117; Mark R. Wilson, “The Politics of Procurement: Military Origins of Bureaucratic Autonomy,” in Richard R. John, ed., Ruling Passions: Political Economy in Nineteenth-Century America (University Park, Penn.: Pennsylvania State University Press, 2006), 44–73; McPherson, 312–3; Foner, 23. For a comprehensive study of mobilization and procurement, see Mark R. Wilson, The Business of Civil War: Military Mobilization and the State, 1861–1865 (Baltimore: the Johns Hopkins University Press, 2006).

  21 LW Dictation.

  22 HsR. 2, part 2, 37th Cong., 2nd sess., vol. 2. On the ubiquity of ship brokers, see the testimony of Ambrose Snow, SR 75, 37th Cong., 3rd sess., vol. 1.

  23 NYTr, June 24, August 14, 1861; NYH, August 15, 1861.

  24 HsR 2, part 2, 37th Cong., 2nd sess., vol. 2; OR Navy, ser. 1, vol. 4: 361.

  25 HED 78, 38th Cong., 2nd sess., vol. 13; HsR 2, part 2, 37th Cong., 2nd sess., vol. 2. The charge of unfair charter prices has been made by, among others, Cedric Ridgely-Nevitt, American Steamships on the Atlantic (Newark, Del.: University of Delaware Press, 1981), 241.

  26 George W. Cullum, Biographical Register of the Officers and Cadets of the U.S. Military Academy at West Point, N.Y., vol. 2 (Boston: Houghton, Mifflin, 1891), 766–7 (George's entry number, or “Cullum number,” in this authoritative guide is 1885); Senate Journal, March 28, 1861; Proceedings of the General Court Martial of Lt. George W. Vanderbilt, May 29, 1861, Records of the Office of the Judge Advocate General (Army), RG 153, NA.

  27 Cullum, 766–7; Proceedings of the General Court Martial of Lt. George W. Vanderbilt, May 29, 1861; NYT, June 6, 1861. For an example of an unreliable account of George (described as capable of lifting nine hundred pounds), see NYTr, January 5, 1877.

  28 McPherson, 324; Strong, 3:203.

  29 McPherson, 373–6.

  30 Howard K. Beale, ed., Diary of Gideon Welles, vol. 1: 1861-March 30, 1864 (New York: W. W. Norton & Co., 1960), 60–5, 473–4; McPherson, 374–6.

  31 OR ser. 1, vol. 9: 31.

  32 Welles Diary, 473; OR Navy, ser. 1, vol. 7: 123.

  33 OR ser. 1, vol. 9: 31. A decade later, William B. Dinsmore hired the Pinkertons to capture Jesse James and his colleagues after the Gads Hill, Missouri, train robbery; see T. J. Stiles, Jesse James: Last Rebel of the Civil War (New York: Alfred A. Knopf, 2002), 249–52.

  34 CV to William H. Seward, May 3, 1866, in SED 46, 39th Cong., 1st sess., vol. 2.

  35 NYT, November 24, 1870; CV to William H. Seward, May 3, 1866, in SED 46, 39th Cong., 1st sess.

  36 JoC, March 22, 1862; John Niven, ed., The Salmon P. Chase Papers, vol. 1 (Kent: Kent State University Press, 1993), 336–8; OR ser. 1, vol. 14: 25–6.

  37 OR ser. 1, vol. 8: 642, vol. 14: 29; JoC, March 22, 1862; LT, May 5, 1862.

  38 CV to EMS, March 31, 1862, reel 2, EMSP. Goldsborough's orders appear in OR Navy, ser. 1, vol. 7: 144–5. See also the report to Stanton by Assistant Secretary of War P. H. Watson, March 28, 1862, OR ser. 1, vol. 14: 46.

  39 OR ser. 1, vol. 14: 477; Battles and Leaders of the Civil War, vol. 1 (New York: Century Co., 1887), 707.

  40 Salmon P. Chase Papers, 1:338; OR ser. 1, vol. 14: 157; Doris Kearns Goodwin, Team of Rivals: The Political Genius of Abraham Lincoln (New York: Simon & Schuster, 2005), 436–9.

  41 McPherson, 445.

  42 McPherson, 444; Stiles, 168–9. The extent of the government's role in the suspension of gold payments is disputed by historians, but certainly it played a role. See Stuart Banner, “The Origin of the New York Stock Exchange, 1791–1860,” Journal of Legal Studies 27, no. 1 (January 1998): 113–40; Robert P. Sharkey Money, Class, and Party: An Economic Study of Civil War and Reconstruction (Baltimore: Johns Hopkins University Press, 1959), 15–28; James K. Kindahl, “Economic Factors in Specie Resumption, 1865–1879,” in Stanley L. Engerman and Robert W. Fogel, eds., The Reinterpretation of American Economic History (New York: Harper & Row, 1971), 468–79; Irwin Ungter, The Greenback Era: A Social and Political History of American Finance, 1865–1879 (Princeton: Princeton University Press, 1964), 13–7; Milton Friedman and Anna Jacobson Schwartz, A Monetary History of the United States, 1867–1960 (Princeton: Princeton University Press, 1963), 3–14. See also Esther Rogoff Taus, Central Banking Functions of the United States Treasury, 1789–1941 (New York: Columbia University Press, 1943), 57–64.

  43 Herman E. Krooss, ed., Documentary History of Banking and Currency in the United States (New York: Chelsea House Publishers, 1965), 1315–6.

  44 McPherson, 445–7; Sharkey, 28–50; McKay, 122; Fowler, 153–4.

  45 Krooss, 2085–6; Taus, 79, 85–6, 102, 112; Richard Franklin Bensel, Yankee Leviathan: The Origins of Central State Authority in America, 1865–1877 (New York: Cambridge University Press, 1990), 262–74, 287–8; Richard Sylla, “Federal Policy, Banking Market Structure, and Capital Mobilization in the United States, 1863–1913,” JEH 29, no. 4 (December 1969): 657–86. Stuart Banner, “The Origin of the New York Stock Exchange,” argues that by 1860 the New York Stock & Exchange Board was already the premier stock exchange in the United States, effectively setting prices nationwide.

  46 Entry for August 22, 1861, David Mitchell Turnure Journal, NYHS; Bensel, 168–9.

  47 McPherson, 442–53; Bensel, 150–78; John Jay Knox, A History of Banking in the United States (New York: Augustus M. Kelley 1969, orig. pub. 1903), 91–104. Boston merchant Amasa Walker, for example, duplicated McCulloch's remarks; see Bensel, 282.

  48 McPherson, 447; Fowler, 73–5, 156–7; Bensel, 152, 162. Foreign coins were actually legal tender in the United States until 1857; Krooss, 1059.

  49 NYH, January 20, 1869.

  50 Since imports were paid in gold, the gold premium represented a kind of tariff. In states that thrived on international commerce, such as New York, leading businessmen favored a return to gold-based currency, as opposed to those in manufacturing centers, such as iron-and-coal-producing Pennsylvania, who competed with English imports. Railroad managers, who imported British rails, favored a gold standard and low tariffs. See Stanley Cohen, “Northeastern Business and Radical Reconstruction: A Re-Examination,” Mississippi Valley Historical Review, 46, no. 1 (June 1959): 67–90.

  51 HC, September 19, 1861; Seventh Annual Report of the Pacific Mail Steamship Company, May 1861 (New York: G. F. Nesbitt & Co., 1861); Report of the President to the Stockholders, Pacific Mail Steamship Company (n.p.: 1868); CV to Chester Arthur, October 8, 1861, reel 1, Chester A. Arthur Papers, LOC; CT, November 11, 1861; Directors' Minutes, May 15, 1861, HRR, reel 27, box 242, NYCRR; NYSAD 100, 85th sess., 1862. The War Department's chartering of CVs transatlantic steamers, particularly the Vanderbilt, led him to discontinue the European line; see RGD, NYC 341:167.

  52 Beckert, 135–6; McKay, 141; Fowler, 54, 57, 73; Harper's New Monthly Magazine, April 1865.

  53 RGD, NYC 375:200a4; SA, November 15, 1862; RT, June 7, 1862.

  54 Andrew Shuman to William H. Seward, August 9, 1861, Walter H. Gaines and Henry S. Rowland to Abraham Lincoln, December 21, 1862, Franz Sigel to Abraham Lincoln, March 17, 1863, Abraham Lincoln Papers, LOC; John D. Hayes, ed., Samuel Francis Du Pont: A Selection from his Civil War Letters, vol. 1: The Mission, 1860–1862 (Ithaca: Cornell University Press, 1969), 112; Frames 237 and 244, Annual List, 1862, District 6, Division 3, Annual Lists, 1862–3, District 1, New York, roll 65, Internal Revenue Assessment Lists for New York and New Jersey, 1862–1866: Microfilm Publication M603, NA. On the problem of dividends in tax reporting, see Rufus S. Tucker, “The Distribution of Income Among Taxpayers in the United States,” Quarterly Journal of Economics 52, no. 4 (August 1938): 547–87.

  55 Atlantic Monthly, May 1868; Forest and Stream, August 28, 1873.

  56 RGD, NYC 374:1; Strong, 3:21.

  57 Burrows & Wallace, 877–81. Melvin L. Adelman argues that the rise of the respectability of harness racing reflected the rise of a new elite in New York; see “The First Modern Sport in America: Harness Racing in New York City, 1825–1870,” Journal of Sport History 8, no. 1 (s
pring 1981): 5–32.

  58 Beckert, 115–9, 136–7; Fowler, dedication page. Fowler also dedicated it to Salmon P. Chase and George S. Boutwell, secretaries of the treasury. His dedication to CV reads, “who has aided so powerfully to foster the steam industries of the nation on land and water.” For an overview of this period, see Burrows & Wallace, 872–82.

  59 McPherson, 314–6, 546–7; Charles G. Summersell, ed., The Journal of George Townley Fullam (Tuscaloosa: University of Alabama Press, 1973), 4–14.

  60 SED 71, 37th Cong., 2nd sess., vol. 6.

  61 HW, May 3, 1862; OR ser. 1, vol. 14: 365–6; HsR 28, 41st Cong., 2nd sess., vol. 1.

  62 OR ser. 3, vol. 2: 525.

  63 OR Navy, ser. 1, vol. 1: 538.

  64 SR 75, 37th Cong., 3rd sess., vol. 1. These quotes come from CVs testimony before Congress a few months later, on December 30, 1862. Regarding the dates of these conversations, Banks reported on November 1 that he left Washington on October 27; OR ser. 3, vol. 2: 712–3. See also James G. Hollandsworth Jr., Pretense of Glory: The Life of General Nathaniel P. Banks (Baton Rouge: Louisiana State University Press, 1998), 83–8.

  65 SR 75, 37th Cong., 3rd sess., vol. 1.

  66 Nathaniel P. Banks to CV, November 3, 1862, CV to Nathaniel P. Banks, November 3, 4, 1862, cont. 24, Nathaniel P. Banks Papers, LOC; CV to EMS, January 24, 1863, reel 4, EMSP; SR 75, 37th Cong., 3rd sess., vol. 1; OR ser. 3, vol. 2: 712–3.

  67 SR 75, 37th Cong., 3rd sess., vol. 1; Senate Misc. Doc. 27, 37th Cong., 3rd sess., vol. 1. CV has been criticized for not personally inspecting all of the scores of vessels chartered for the expedition. But as CT, January 15, 1863, justly noted, he went by the insurance underwriters' ratings, which he would have relied on if he had chartered the ships for his own use. CV had earlier testified, “I seldom go aboard of ships unless to go somewhere;” HsR 2, Part 2, 37th Cong., 2nd sess., vol. 2. On the censure resolution, see Senate Journal, January 21, 27, 29, 1863.

  68 NYTr, December 5, 1862.

  69 McPherson, 624. For a report from aboard ship on the expedition, see NYTr, December 29, 1862.

  70 Raphael Semmes, Memoirs of Service Afloat During the War Between the States (Baton Rouge: Louisiana State University Press, 1996, orig. pub. 1868), 529–30; Fullam Journal, 60–1.

  71 NYT, December 28, 1862.

  72 George Willis Read, ed., A Pioneer of 1850: George Willis Read, 1819–1880 (Boston: Little, Brown, 1927), 130–2; NYT, December 28, 1862; Frank Leslie's Illustrated Newspaper, January 10, 1863.

  73 Semmes, 535; Fullam, 66; NYT, December 28, 1862; Frank Leslie's Illustrated Newspaper, January 10, 1863; LT, January 14, 1863; CT, December 31, 1862; OR Navy, ser. 1, vol. 1: 782–3.

  74 NYT, December 29, 1862.

  75 OR Navy, ser. 1, vol. 1: 604–5.

  76 Semmes, 672, 737; HED 1, part 2, 38th Cong., 2nd sess., vol. 2; McPherson, 547. The Vanderbilt, though much sought after by navy officers, had problems peculiar to its adaptation to naval service. At the end of commercial voyages, the jet condensers that allowed it to boil seawater ordinarily would be cleared of scale formed by boiling brine; under continuous use, scale buildup and corrosion became a serious problem; Cedric Ridgely-Nevitt, 244–5.

  77 Senate Journal, July 17, 1862; SED 30, 37th Cong., 3rd sess., vol. 1; Cullum, 766–7. For reports of the other George W. Vanderbilt, see OR ser. 1, vol. 21: 59, vol. 27, part 1: 981–2. In CVs obituaries and elsewhere, it would be claimed that George fell sick during the Corinth campaign in early 1862. No direct evidence supports the story. NYS, December 9, 1885, claimed that George had consumption, but the accuracy of this report is impossible to assess.

  Fourteen The Origins of Empire

  1 NYTr, February 6, 1879. See also NYH, October 3, 1869.

  2 Sven Beckert, The Monied Metropolis: New York City and the Consolidation of the American Bourgeoisie, 1850–1896 (New York; Cambridge University Press, 2001), 146–9.

  3 SR 75, 37th Cong., 3rd sess., vol. 1; CT, January 13, 1863.

  4 NYSAD 19, 90th sess., January 18, 1867.

  5 RG, January 12, 1877.

  6 RG, January 12, 1877.

  7 These changes are often located at the very end of the nineteenth and beginning of the twentieth centuries, when they took full hold on the economy as a whole, but they would be well under way before the end of CVs life. See Gregory A. Mark, “The Personification of the Business Corporation in American Law,” University of Chicago Law Review 54, no. 4 (autumn 1987): 1441–83; Naomi R. Lamoreaux, “Partnerships, Corporations, and the Limits on Contractual Freedom in U.S. History: An Essay in Economics, Law, and Culture,” in Kenneth Lipartito and David B. Scilia, eds., Constructing Corporate America: History, Politics, Culture (Oxford: Oxford University Press, 2004), 29–65; Alan Trachtenberg, The Incorporation of America: Culture and Society in the Gilded Age (New York: Hill & Wang, 1982), 4–6, 57–8.

  8 Alfred D. Chandler, The Visible Hand: The Managerial Revolution in American Business (Cambridge, Mass.: Harvard University Press, 1977), 1–12, 79–121; Trachtenberg, 3–10.

  9 For examples of this thinking among contemporaries and later writers, see Henry Clews, Twenty-Eight Years in Wall Street (New York: Irving Publishing, 1888), 110, and Edward J. Renehan Jr., Commodore: The Life of Cornelius Vanderbilt (New York: Basic Books, 2007), 239.

  10 For a portrayal of CVs plans as a long-laid campaign, see the highly influential “A Chapter of Erie,” NAR, July 1869, 30–106, in which CFA writes, “His object has been to make himself the virtual master of all by making himself absolute lord of the railways.” I may be accused here of misrepresenting CFA and the historiography; CFA, like many historians, hedges on CVs thinking. My point is merely to represent the general tenor of the depictions of CVs method. See, for example, Fowler, 494–5.

  11 This observation reflects a broad investigation of CVs life. See also Chauncey M. Depew, My Memories of Eighty Years (New York: Charles Scribner's Sons, 1922), 228–9.

  12 CV to Edwin D. Morgan, February 16, 1863, fold. 2, box 13, Edwin D. Morgan Papers, NYSL.

  13 LW Dictation.

  14 NYH, January 20, 1869. On railroads' size relative to other enterprises, see Alfred D. Chandler Jr., ed., The Railroads, the Nation's First Big Business: Sources and Readings (New York: Harcourt, Brace & World, 1965), 43. On the value of Harlem shares, see NYSAD 175, 86th sess., 1863.

  15 NYSAD 175, 86th sess., 1863; NYSAD 19, 90th sess., 1867; NYSAD 114, 90th sess., 1867; NYH, March 25, 1863.

  16 See HFC's testimony in NYSAD 19, 90th sess., January 18, 1867. See also Lane, 188–9; NYT, June 30, 1858, April 15, 1859; Directors' Minutes, May 4, 1859, HRR, reel 27, box 242, NYCRR; Alvin F. Harlow, The Road of the Century: The Story of the New York Central (New York: Creative Age Press, 1947), 166; Edward Hungerford, Men and Iron: The History of the New York Central (New York: Thomas Y. Crowell, 1938), 120–6. For a precise description of a journey (albeit a customized one) from the depot north, showing how the horses hauled cars to Forty-second Street, see NYT, July 6, 1865.

  17 Fowler, 199–201, 203–5.

  18 Hudson C. Tanner, “The Lobby” and Public Men from Thurlow Weed's Time (Albany: George MacDonald, 1888), 230.

  19 NYSAD 175, 86th sess., February 17, 1863, shows that the Harlem had unusually high revenues and expenses per ton/mile, making it a ripe target for reform.

  20 NYSAD 19, 90th sess., January 18, 1867.

  21 It is nearly impossible to accurately estimate how many shares anyone—least of all CV—held in the 1860s and ′70s. As will be seen, CV routinely transferred shares he owned into the names of others to disguise his holdings. Both press reports and WHV's testimony suggest that, by the end of the events described at least, CV owned half of the company's shares, not including those held by allies and family members. See HW, July 11, 1863; NYSAD 19, 90th sess., January 18, 1867. These reports, however, came later; on May 18, 1863, CV voted only 8,801 out of more than 114,000 shares (and 88,978 voted) at the annual stockholders' meeting and election; Directors' M
inutes, May 18, 1863, HRR, reel 27, box 242, NYCRR.

  22 McPherson, 323–4; Mark Wahlgren Summers, The Era of Good Stealings (New York: Oxford University Press, 1993), 16–23.

  23 HW, July ii, 1863; Burrows & Wallace, 917.

  24 RGD, NYC 342:300D. See also Smith, 294, for an amusing description of Law.

  25 NYH, March 26, 1864. For examples of reports that name Law, see NYTr, April 24, 1863; Strong, 3:313; NYT, April 25, 1863. See also Lane, 191–2.

  26 Strong, 3:313; NYTr, April 24, 1863; NYH, April 24, 1863; HW, July 11, 1863. In truth, money-driven attempts to build a Broadway railroad (and the belief that corrupt railroad men had bought the legislature) had been a regular feature in Albany in recent years; see NYH, January 1, 1860.

  27 Burrows & Wallace, 835–8; Ernest A. McKay, The Civil War and New York City (Syracuse: Syracuse University Press, 1990), 230–3.

  28 NYH, April 22, 24, 1863; HW, July 11, 1863; Fowler, 205; see also NYH, April 24, 1863; Directors' Minutes, April 22, 23, 1863, HRR, reel 27, box 242, NYCRR.

  29 NYH, April 24, 25, 1863; NYT, April 25, 1863; Strong, 3:313.

  30 CV to EC, May 13, 1863, fold. 3, box 81, ECP.

  31 Ibid.; Directors' Minutes, May 18, 19, 29, 1863, HRR, reel 27, box 242, NYCRR. The new board was seen as “the Vanderbilt ticket;” PS, May 28, 1863. The HRR minutes show that CV voted only 8,801 out of the 88,978 shares represented at the stockholders' meeting (about 114,000 existed). HFC had 1,350, AS had two thousand, and JHB had three thousand, all of which really might have been CVs property, held in their names. To achieve victory, then, CV drew upon the support of men who controlled many more shares, such as A. B. Baylis with 19,970, and Henry G. Stebbins (JLW's onetime partner) with 10,650, though they may have been holding shares for CV as well.

  32 Directors' Minutes, May 18, 19, 29, 1863, HRR, reel 27, box 242, NYCRR.

  33 NYH, April 22, 24, May 11, 1863; HW, July 11, 1863.

  34 H W, July 11, 1863; NYH, June 26, 1863. Henry Clews, Fifty Years in Wall Street (New York: Irving Publishing, 1908), 111, and Fowler, 206–8, repeat similar versions of this story.