In 1866 Beach began experimenting with pneumatic power, making models of mail tubes. The next year, during the American Institute Fair held in the Fourteenth Street armory, he built a plywood tube six feet in diameter and a block long on the armory floor. Inside this tube was a ten-passenger car. Using a big fan, Beach blew the car from Fourteenth Street to Fifteenth Street and then sucked it back. Hundreds of people enjoyed this ride, and Beach now knew that he could propel a train through a pneumatic tube.
The inventor was aware that Tweed had killed Willson’s hope of building a subway, and he knew about the graft involved in obtaining transit franchises. He decided not to seek a franchise from corrupt city officials, telling his brother, “I won’t pay political blackmail. I say let’s build the subway furtively.” He asked the state legislature for a charter to dig what he characterized as a pneumatic mail tube system under Broadway. In 1868 the bill crossed the desk of State Senator Tweed, who failed to understand its implications. Beach got his charter. Soon he had a gang of laborers burrowing a tunnel 21 feet under Broadway just west of City Hall. This hole in the ground was only 312 feet long, running a single block from Murray Street on the south to Warren Street on the north. The project went on in complete secrecy, the workmen dumping bags of earth into wagons whose wheels were muffled to avoid all noise. The digging was finished in only 58 nights. Then the men bricked in the tunnel, which had an outside diameter of 9 feet and an inside diameter of 8 feet.
On February 26, 1870, New Yorkers awakened to find that they had a one-block subway. The Herald blared: “FASHIONABLE RECEPTION HELD IN THE BOWELS OF THE EARTH!” Tweed was furious. City and state officials, aware of his anger, stayed away from the new marvel, but the people flocked to see it. They were overwhelmed by the subway’s waiting room, which was nearly half as long as the tunnel itself. All was elegance, the walls frescoed, paintings hung here and there, a grand piano standing in stately splendor, a fountain bubbling, and a tank glistening with goldfish—all lighted by zircon lights. Beach purposely had made the waiting room impressive in the hope of winning popular support for the battle he anticipated with Boss Tweed.
New Yorkers were delighted with their pneumatic subway, but Beach still had to ask the state legislators for a new charter. After all, he had built a transit line instead of a pneumatic postal system. What’s more, he wanted to extend his subway the length of Broadway. Now the state governor was John T. Hoffman, whose political future lay with Boss Tweed. The lawmakers passed Beach’s transit bill, but the governor vetoed it. In an editorial the Tribune stormed, “Of course it was to be expected that, as long as Tammany had no hand in the scheme and saw no chance of converting it into a swindle, its influence would be used against it.”
This was in 1871. The next year the people threw Hoffman out of office, and in 1873 a third Beach bill came before the legislature. It won the approval of both the lawmakers and the new governor, John A. Dix. By this time, however, the city was writhing in the grip of a depression, and Beach could not get enough capital to extend or even maintain his subway. Late in 1873 Governor Dix withdrew Beach’s charter with “the greatest reluctance.” Not until the beginning of the twentieth century was New York to get a permanent subway.
In 1871 self-propelled steam locomotives replaced the cable-winding engines on the Ninth Avenue elevated, whose tracks now pushed north of Thirtieth Street. Vanderbilt’s Hudson River railroad thrust even farther north, making it possible for Yonkers to become a separate city in 1872. The same year Vanderbilt wangled through the legislature a bill forcing New York City to pay $4,000,000 to improve the roadway of his New York Central tracks on Park Avenue. On February 1, 1872, the New York Council of Political Reform declared publicly that for a long time the city had been swindled out of at least $1,000,000 a year in the development of surface railroads.
Expansion of elevated railways marked the first real advance in the city’s rapid transit. English visitors liked New York’s elevated better than their own London subway. A German geographer, who saw New York in 1873, said that its transportation facilities were better than those of any European city. Improved transit caused a real estate boom that made ever more money for Tweed and his henchmen. On the inside of everything, they bought property where improvements were to be made and then sold this land to the city at fantastic sums. The strip that became Riverside Drive should have cost only $1,400,000, but the Tweed Ring had run the cost up to $6,000,000 by the time the purchase was made in 1872.
Three years later the state legislature passed the Husted Act, empowering New York’s mayor to appoint the city’s first rapid transit commission. Its members chose elevated railways as the best medium for moving New Yorkers around the city speedily. They also selected Second, Third, Sixth, and Ninth Avenues as routes for these railways. Rail by rail, pillar by pillar, the elevateds took shape overhead; the tracks were thirty feet high in most places and even higher in others. On narrow streets the aerial railroads were built right over sidewalks and almost flush with the sides of buildings.
The Third and Sixth Avenue elevateds were the first to begin operations in 1878. Each train consisted of four cars, painted light green, their interior upholstery finished in dark brown. Trains ran from 5:30 A.M. until midnight. The fare was ten cents a ride except during rush hours, when it cost five cents. Conductors collected tickets threaded with silk as a protection against counterfeiting. The engines started with a jerk that jolted the spines of passengers. The clatter and rumble of the sky trains frightened horses on the streets, while the soot, cinders, and burning coals they dropped infuriated pedestrians and housewives. People living on the second and third floors of tenements, on a level with the passing cars, lacked privacy unless they pulled down their shades. Oil squirted into their parlors when their windows were open. Property values declined all along the elevated lines. Despite these drawbacks, New York now had a transit system of which it could be proud—for a time.
The same could not be said of the interstate Erie Railroad, whose tracks were reaching the Midwest. Its flaking rails sank into rotten ties and undulated beneath the wheels of passing trains. Nonetheless, since it offered the possibility of plunder, a group of rapacious tycoons fought one another for possession of this down-at-the-heels line. Because their fiscal war was waged in New York courts and the Stock Exchange, this railroad was called the Scarlet Woman of Wall Street.
Cornelius Vanderbilt, rapidly developing into the nation’s top railway magnate, wanted this Scarlet Woman. Boss Tweed, who had served as a representative of the Vanderbilt interests in Albany, favored Vanderbilt at first. Judge Barnard therefore issued the injunctions Vanderbilt demanded in the Erie war. Vanderbilt’s chief antagonist was shy, swarthy, wispy Jay Gould, a financial wizard who liked to raise orchids. Gould nervously twisted his feet as he talked, and Mrs. Abram S. Hewitt shuddered and said that he had the eyes of a snake. Gould bribed Tweed to come over to his side by offering him more money than the $19,000 Vanderbilt handed the Tweed Ring. Gould gave the Boss a block of Erie stock, had Tweed and Sweeny elected to the Erie’s board of directors, and paid Tweed $1,500,000 for “legal” services and expenses—Judge Barnard having proclaimed Tweed an attorney-at-law. The judge then handed out the injunctions sought by Gould and denied those Vanderbilt wanted. Gould won the Erie war, and Tweed happily helped him defraud the railway’s investors.
Using the money milked from the Erie, Gould then schemed to corner the market in gold. In the 1860’s the United States was not on the gold standard. Monetary values were expressed in terms of paper money. Gold was scarce, and the scarcity resulted in high interest rates. By 1869 the federal treasury held in reserve $95,000,000 in gold, but only $15,000,000 worth of the precious metal circulated throughout the country. Gould planned to rake in this $15,000,000 and then set his own price on gold. He felt that he could make a fast killing and reap enormous profits before gold could be imported from Europe—provided one thing: provided the federal treasury did not sell any of its $95,000,00
0 in gold. Vital to his plot was knowledge of what the government might do once he made his move.
As his chief ally Gould picked James Fisk, Jr., a shameless financial buccaneer, who was short and round and merry. “I was born to be bad,” Fisk said of himself. His mustache was “the color of a Jersey cow” and as long and pointed as the spikes of a catfish. Fond of champagne and chorus girls, Fisk was as charming as he was ruthless. He helped the shy Gould by playing host to the important people they set out to capture.
Ulysses S. Grant was President of the United States at the time, so Gould and Fisk cultivated Abel Rathbone Corbin, who had married Grant’s sister. Into their scheme they drew Daniel Butterfield, whom Grant had named as head of the New York subtreasury without really studying his qualifications. Gould and Fisk were unable to involve Grant’s private secretary, Horace Potter, but they did entertain the President himself. Fisk called himself an admiral because he owned a fleet of steamships plying the waters off Long Island, and he and Gould took Grant sailing. They tried to worm out of him some hint about the treasury’s gold policy. They implied that if the United States kept gold at a high price, this would help sell American grain in Europe, thus aiding the American farmer. Grant kept mum. The plotters decided to go ahead anyway. Corbin wrote an article entitled “Grant’s Financial Policy,” and Gould managed to get all but the last paragraph printed in the New York Times as an editorial.
Since the nation was on a paper standard, gold was bought and sold as a speculative commodity. The trading took place in the Gold Exchange, established in 1864 on the corner of Broad Street and Exchange Place. Everyone called it the Gold Room. In the center of the room stood a fountain containing a bronze statue of Cupid, a dolphin in its arms. A tiny stream of water spouted from Cupid’s head to a basin below. A mechanical indicator inside the room and another on an outdoor wall over the sidewalk told the current price of gold. Such was the setting of the most frenetic day thus far in the history of Wall Street.
On September 2, 1869, Gould bought $3,000,000 worth of gold through more than 40 brokers. The price rose 5 points in two days. Because Gould told Fisk that President Grant had forbidden Secretary of the Treasury George S. Boutwell to sell any of the government’s gold reserve, Fisk also began buying. As the price of gold soared, other traders became suspicious, and newspapers urged the government to break up the gold conspiracy. Secretary Boutwell hurried from Washington to New York, looked into the situation, but decided to do nothing until instructions arrived from Grant. It was difficult to reach the President, who was visiting a small Pennsylvania town. When at last he heard the news, he became disturbed. Grant got back to Washington on September 22, and that day gold closed at 140½ points. The next day, when it reached 144, the panic began. Throughout the nation, manufacturers and other businessmen, thinking that gold might hit a peak of 200, ordered their agents to buy at any price.
Then came Friday, September 24, 1869—infamous Black Friday. Brokers in the Gold Room and crowds on the sidewalk outside watched apprehensively as the price of gold went up, up, up. This meant ruin for hundreds of thousands of Americans, because bankers’ paper was unsalable except at a high premium, while merchants’ paper could hardly be sold at any price. Gold transactions that day amounted to more than $400,000,000. As telegraph lines dit-dah-ditted the news across the country, business from Boston to San Francisco ground to a halt. Speculators, merchants, and workers realized that their futures depended on what was happening in New York’s Gold Room.
In Washington the President and Secretary Boutwell were kept informed of minute-by-minute developments. When the price reached 160 at about 11:30 A.M., one man fainted in the Gold Room, and many wept openly. Secretary Boutwell nervously suggested to President Grant that they sell $3,000,000 of the nation’s gold reserve. Grant mentioned $5,000,000, but Boutwell wired the subtreasury in New York to sell $4,000,000. Butterfield, the man in charge of the subtreasury, may have tipped off Jay Gould about the selling order, for now Gould switched tactics and began unloading. Jim Fisk, unaware that Gould was doublecrossing him, urged his broker, Albert Speyer, to buy more and more and more. A few minutes before noon, when gold reached its high of 162½, everyone learned that the New York subtreasury intended to sell $4,000,000 worth of gold the next day.
Fortunes were lost. Wall Street brokerage houses failed. Railway stocks shrank. The nation’s business was paralyzed. An observer in the Gold Room wrote that “the spectacle was one such as Dante might have seen in the inferno.” Half a dozen men went temporarily mad. A broker, named Solomon Mahler, slunk home and killed himself. A little man with glassy eyes staggered about the floor, croaking, “I’m Albert Speyer! Some people have threatened to shoot me. Well, shoot! Shoot!” Men cursed and screamed and laughed maniacally and dashed from one trading post to another. Their nerves were tighter than the gut of an Indian’s bow. Half-moons of sweat stained the armpits of their jackets. From time to time they wobbled to the fountain to dash cool water on their burning faces.
The frenzy inside the Gold Room reached the people on the sidewalk outside, fermenting the crowd into a mob that howled for the hides of Jay Gould and Jim Fisk. A national guard regiment was ordered to stand by to “quell the riot in Wall Street.” But Boss Tweed, forever loyal to fellow scoundrels, gave the plotters police protection. Gould, who had failed to corner all the gold in circulation but who nonetheless made a profit of $11,000,000, said smoothly, “I regret very much this depression in financial circles, but I predicted it long ago. I was in no way instrumental in producing the panic.” Fisk, who had lost money but soon found a way to repudiate his contracts, spoke with his usual impudence: “A fellow can’t have a little innocent fun without everybody raising a halloo and going wild.”
Greedy to the last, neither cared about the suffering they had inflicted on numberless innocents. Tweed didn’t care, either.
Monarch of all he surveyed, affecting the grand manner in public, and arrogant to friend and foe alike, Tweed had become giddy with success. A once great city had degenerated into Tweedsville. While the Boss ate oysters at Delmonico’s, rode behind sleek trotting horses, cruised aboard his yacht, and beamed on champagne-swilling cronies, New York fell into ruins.
It was filthier than Naples. Dirty streets and defective sewer pipes resulted in abnormally high death rates. Tweed’s stables were superior to any tenement in town. Public buildings sagged into dilapidation for want of proper maintenance. Produce was unloaded on rotting wharves. Every day was Mardi Gras for thieves and harlots. The annual tax levy rose from an average of $4.33 per person in 1860 to $25.11 in 1870. Between 1869 and 1870 the city debt soared from $36,000,000, to $97,000,000, and the town teetered on the edge of bankruptcy. G. T. Strong lamented in his diary: “To be a citizen of New York is a disgrace.”
Tweed became arrogant because he became careless, and he became careless because it had been so easy to plunder the city. For example, in a couple of hours one morning Tweed and his henchmen stole more than $5,500,000. Here’s how it happened: Under the new Tweed charter the new board of audit consisted of Tweed, Hall, and Connolly. At one of the board’s first meetings, on May 5, 1870, the trio authorized the payment of an additional $6,300,000 for the new courthouse they were building. Nearly 90 percent of this sum was padding, and they pocketed the extra $5,500,000. The same day six Negroes were arrested for playing penny poker in the basement of 208 West Thirtieth Street.
When the sands of time begin to run out for any man, it is difficult to detect the first grain, but for Tweed it may have begun to trickle into infinity on December 24, 1869. On that date Harper’s Weekly published a cartoon showing members of the ring breaking into a big box marked “Taxpayers’ and Tenants’ Hard Cash.” Fletcher Harper owned this courageous magazine, and George William Curtis was its editor. The cartoon came from the pen of German-born Thomas Nast, who wore his hair crew cut in the fashion of Prussian officers. A fierce handlebar mustache and pointed beard emphasized the virility of this clear-eyed
man. A gifted cartoonist and caricaturist, Nast created the symbolic Republican elephant and Democratic donkey, and soon he was to paint some stripes on Tammany.
In the spring of 1870 Comptroller Connolly complained that he wasn’t getting a big enough cut of the loot. He told Tweed that other members of the ring would be unable to swindle the city at all without him. Tweed asked what he had in mind. Connolly said he wanted 20 percent instead of just 10. Tweed decided that this could be managed by doublecrossing Mayor Hall and City Chamberlain Sweeny. From that time on, Hall and Sweeny got what they thought was 20 percent of the take, although it was really only 10 percent.
Toward the end of the summer of 1870 James Taylor died. He had been Tweed’s partner in the New York Printing Company, which, not surprisingly, did far more business than other printing firms. Taylor also had been one of the three directors of the New York Times. While Taylor was alive, the Times did not attack Tweed, but now that he was dead, the influential morning paper fell under the control of George Jones, who detested the Boss. Although no one confused George Jones with St. George, he began hunting the dragon.
On September 20, 1870, the Times published its first attack—not as a news article on page one, but as an editorial inside the paper. It was written by the Times’ managing editor, Louis J. Jennings, who wielded his pen like a broadsword. Born in England, Jennings had worked on newspapers in London and India, and years after the Tweed exposé he returned to Great Britain and wound up as a Member of Parliament. Now, day after day, Jennings lambasted Tweed, making such charges as: “No Caliph, Khan or Caesar has risen to power or opulence more rapidly than Tweed I. Ten years ago this monarch was pursuing the humble occupation of a chairmaker in an obscure street in this city. He now rules the State as Napoleon ruled France, or as the Medici ruled Florence. . . .” Jennings dealt mainly in invective because the Times lacked enough hard facts to make the kill.
The Epic of New York City Page 40
