The Clara Nevada: Gold, Greed, Murder and Alaska's Inside Passage

by Steven C. Levi

  The second blow was the Nome gold rush. On May 6, 1899, the Post-Intelligencer ran a small filler, telling “of a marvelously rich gold discovery at Cape Nome, halfway between Golovin Bay and Bering Strait, near the entrance of Norton Sound.” Suddenly the attention of the world was focused on the golden beaches of Nome on the Bering Sea. Overnight, the Klondike in Canada’s Interior lost its luster. In October, the Post-Intelligencer reported that Dawson was emptying, as much of its population joined in the rush to Nome. So many were leaving, reported some stampeders, that “men are getting scarce in the Klondike metropolis.” Lewis, still beached, had to suffer the indignity of seeing the rush to Dawson reverse itself on the river.

  The most significant nails in the coffin of the Yukon River steamboat businessman were the twin forces of competition and regulation. A shiver must have whisked down the back of every gypsy steamboat operator when it was announced that Alaska was to have a body of codified laws. In June 1899, Congressman Vespasian Warner of Clinton, Illinois, went north to see firsthand what was going on in Alaska.

  Warner was concerned that Alaska was still a wide-open frontier. Codified law, he believed, would civilize the territory, and a civilized Alaska would attract investment capital. But before the investment capital could be attracted to the northland, there had to be civil assurances that investments would be safe. Alaska’s banks had assets “up to the neighborhood of $7,000,000,” Warner told the Post-Intelligencer. With that kind of a capital base, “Eastern money is not now asking as to the stability of [Alaskan] business and growth but only the character of the particular investment for which it is wanted.” In other words, Warner felt Alaska had enough cash to interest the eastern banking establishment.

  But it wasn’t only eastern investors who were concerned about the fiscal integrity of Alaska, Alaskans wondered about it. In August 1899, just ahead of freeze up, the newly elected congressman from Washington State, W.L. Jones, fresh from a trip to Alaska, gave an exclusive interview to the Post-Intelligencer. He stated that the Alaskans considered themselves disenfranchised Americans. They wanted more courts, a just tax system and more equitable distribution of federal dollars.

  Alaskans began taking a greater part in shaping their own destiny. As Alaska’s population grew, Alaskans began to demand their federal rights. On August 15, 1899, a contingent of Alaskans visited Juneau to call a territory-wide meeting in October to protest the “outrageous neglect and ignorance manifested by our national legislative body.” They then proceeded to decry their lack of representation in Washington, D.C., and declared what was akin to a declaration of independence for Alaskans.

  Virtually absent earlier, law and order were coming to the northland. In 1896, Alaska’s law consisted of a single judge, marshal and ten deputies, along with a handful of quasi-law-enforcement employees, such as Indian policemen under the Department of the Interior. Justice had generally been the function of miners’ councils. The community elected representatives who dealt out punishment from hanging to whipping. But by 1897, Congress was stepping to the fore. Army personnel were sent to reconnoiter the location of forts. Two were eventually established at Eagle and Tanana. A Revenue cutter, the Nunivak, was assigned to patrol the Yukon River.

  With competition came regulation. In May 1898, twenty-six carloads of boats arrived in Everett for shipment to the Yukon. In July 1898, the Seattle inspector of hulls and boilers stated that Yukon River steamers would no longer be allowed carry passengers from San Francisco to St. Michael. There was also the formation of an Alaska Traffic Association to stop rate cutting and stabilize the prices in the steamboat trade. They established a base ticket price of $300 for first class and $250 for steerage from Seattle to Dawson. Steamships would be classified as to condition and accommodations, and then a price scale would be assigned.

  Predictably, this last scheme was a grand idea, but the coalition couldn’t last. There was still too much money to be made on the northern route. The association lasted all of two weeks, and then it fell apart, as its membership went right ahead and cut rates anyway.

  Perhaps just as critical to Lewis, winter traffic in 1898 began picking up by the end of the year. Worse, while the Yukon was not navigable during the winter, the Inside Passage was packed with ships on their way to Dyea and Skagway. “Travel to Alaska has set in with greater magnitude than has ever been known at this time of year,” the Post-Intelligencer noted in December 1898. Then, in the article immediately beneath that, it was announced that the Chilkoot Pass trams had been put into good condition and would begin operating again on the first day of January at the rate of six and a half cents a pound. By comparison, in early 1898, Tlingit were charging one dollar a pound to pack the same food and supplies.

  New modes of transportation began to emerge because long-term investment in northern transportation was still deemed profitable. On February 10, 1899, the Post-Intelligencer ran a sidebar on the movement of the ship-building industry from the East Coast to Seattle, particularly with regard to wooden sailing vessels. Seattle, the Post-Intelligencer revealed, was a natural port for such an industry. First, there was the ability to build a superior craft cheaper with better material. Better material was Washington fir, which could stand “bumping and strains better” because of its “rubber-like quality” that kept it from “cracking when driven against piers or docks.” Just as important was the opening of China to American wheat. Though this was in the “years to come,” the Post-Intelligencer assured its readers that “Eastern men realize [the] great future of the [Puget] Sound [and] they will come slowly at first, and then in droves, to take advantage of its great superiority.”

  This might not have been so farfetched. In fact, in July 1899, the United States government stated that fiscal 1899 had been the best year in a decade for shipbuilding. Excluding 1891, it had been the best year in the past quarter century. More than 1,400 vessels had been constructed in the previous twelve months compared to more than 1,500 made by Great Britain. “Nearly all our tonnage is built to navigate in the coasting trade reserved to American vessels,” the report stated.

  For the Yukon River traffic, shipbuilders were experimenting with a new model, a wide-bodied, shallow-draft steamer for river travel. Unveiled in April 1899, this new breed of river craft was powered by six engines, one for each propeller. It was the only such vessel in the Western Hemisphere, and only two others were in existence, both on the Nile. The track record of this craft, so to speak, was impressive and precisely suited for travel in waterways like the Yukon. The craft proved to be a “wonderful success in shallow water, going over bars and riffles where the water was only a foot in depth and making not only time but pulling heavy loads.”

  If this business stealer wasn’t enough to make the blood of Yukon steamboat captains boil, mammoth rafts were also introduced. Construction on the first began in February 1898. It was so large that “there could not be found in West Seattle a strip of level ground long enough” to handle it. When completed, it was 650 feet long and 58 feet wide and towered over the water by some 30 feet. Though the raft had 300,000 board feet, it would float high in the water and thus could be used effectively in shallow-water river areas. This enormous shipping barge would, as well, put a crimp in the conventional river steamer traffic.

  But with all the changes, the bottom line remained the same. With the privilege of being the “Gateway to Alaska,” Seattle claimed the right to fleece stampeders and wallow in greed. For the Post-Intelligencer, it was easy. Whenever a rich man came to town, his name and amount of gold he possessed were printed in the paper. The lists of successful Klondikers ran several columns in the Seattle Times. Often, as in the cases below, the information was actually provided by the “purser and captain of the steamer,” who, of course, “vouch[ed] for accuracy of the amount.”

  H.M. Kerry, general manager of the Yukon Steamship Company, has $50,000 in nuggets for exhibition purposes; J.B. Rhodes, Portland, Oregon, $60,000 in dust; W. Caldwell, Portland, Oregon, $80,000 in du
st (two members of Philadelphia Yukon Syndicate); Edouard Larson, $100,000 in gold dust; Antoin Leoatoad, $100,000 in gold dust, J. Sinclair, Vancouver, $25,000, and some $50,000 divided among the rest of the passengers on the steamer Fastnet represents the amount of gold dust brought from the Yukon today.

  Steamer Humboldt arrived in port at 4 o’clock yesterday afternoon, twelve days out from St. Michael. She brought 233 passengers all from up the Yukon, who had among them not to exceed $100,000 in gold dust and nuggets. But the sum was far exceeded by the value of drafts held by returning Klondikers.

  In the strong boxes [at St. Michael] of the big companies is stored over $4,000,000. The yellow metal which has drawn thousands of men to this part of the world has been coming in sacks and boxes by every boat. [The first three boats down the Yukon brought a total of $5.5 million in gold.]

  In a “Special Klondike Edition” on July 17, 1898, the Post-Intelligencer listed name after name of individuals and ships and the amount with which they returned. The term “millions” was used time and again, and the steamers bearing the Klondikers to Seattle were called “treasure ships.” Adding up the nuggets and dust brought to Seattle during July, the Post-Intelligencer estimated the city had seen $7,296,000 pass through its port. (This is about $162 million in 1990 dollars.) Newspapers elsewhere in the nation reprinted these attractive figures, and the unwary flooded to Seattle.

  A year later, in July 1899, the paper ran a story quoting William Ogilivie, the “Canadian Government’s Yukon Commissioner,” who said that the gold coming out of the Klondike topped $100 million in 1898, a pronouncement that did little to stem the tide of Klondikers headed north.

  To keep these numbers in perspective, in Seattle in 1898, potatoes were selling at $0.55 a hundred, cheese for $0.10 a pound. Hams were going for $0.09 a pound, bacon for $0.11 and prunes for $0.03. Children’s gloves cost $0.50. A dining room table ran $3.75, and parlor sets of three chairs, now called “top quality antiques,” went for $24.50 a set. If you wanted to make your own clothes, Scotch gingham went for $0.25 a yard and pure silk at $0.75.

  Things were a bit more expensive in Dawson, however. There, a candle cost $1.00. Flour went for $100.00 a sack and oysters for $25.00 a pound. Tobacco cost $7.50 a pound and cigarettes $0.50 a pack. Fresh mutton went for $1.50 a pound, beef at $1.00 and moose up to $1.75. The next summer, oranges and lemons went for $1.50 each and watermelons for $25.00. Dogs sold for up to $400.00, depending on the quality of the animal, and as Adney noted, a copy of Shakespeare’s works went for “$50.”

  But stories of the cornucopia of gold emptying into Seattle coffers said nothing of the thousands of luckless stampeders who returned penniless. By March 1898, the Review of Reviews estimated that stampeders spent over $60 million in supplies and tickets, of which Seattle was credited with receiving $16 million. But by the end of the year, the total Klondike output was estimated at only $ 10 million.

  The human toll left by the Klondike gold rush was both staggering and frightening. Of the estimated 100,000 people who actually set out after gold, only 30,000 made it as far as Dawson. About 15,000 of those looked for gold, but only 1 out of every 3 prospectors actually found any. Of these, no more than 300 became wealthy. Those were stiff odds in a luckless game. In modern terms, any ordinary citizen’s chances of becoming wealthy from the Klondike rush were about three-tenths of 1 percent. Today, one would have a better chance of making a million dollars on the commodity futures market with $1,000 or picking a winning lottery number.

  A single summation of the dreadful human cost of greed and the Klondike rush could not have been better presented than in the July 21, 1898 Post-Intelligencer. In reporting the arrival of two groups of Klondikers, the journalist wrote:

  There are dark shadows to every picture. On Tuesday night, while scores of the fortunate Klondikers who arrived on the Roanoke were scattering gold with a lavish hand in the gilded resorts of the Tenderloin, surfeited with the richest food and flushed with the choicest wines, twelve honest, hard-working men who had been their fellow passengers on the trip down from Unalaska to Seattle, were sleeping in box cars on the waterfront, cold, supperless and without a penny to insure them breakfast when the weary night would end.

  The twelve destitute men were members of the Alaska Mutual Transportation & Mining Association of Chicago. Their savings for years and their gilded hopes and dreams for the future had been shattered by the angry waves of the north Pacific. On the morning of July 4, after a night of terror, the river steamer Alfred J. Beach, upon which they were passengers bound for St. Michael in tow of the steamer Noyo, was cut loose and settled into the depths of the ocean, a dismantled and water-logged hulk.

  Chapter 8

  Mass Murder and Robbery or an Accident?

  Now that the chronicles of C.H. Lewis and the Clara Nevada have been revealed, there remains the speculation of what actually happened on the night of February 5, 1898. Based on documentation I have found, I believe I have pieced together what happened and, to a certain extent, who perpetrated a monstrous crime. What I have been able to develop is a reasonable scenario of events, backed by source material, to support my speculation. In the end, however, what I am presenting is an amalgam of circumstantial evidence.

  I now believe that the Clara Nevada was deliberately sunk for the purpose of covering up the robbery of $165,000 in gold dust. I believe the thieves set a modest charge of dynamite with a delayed fuse against the inside wall of the boiler room to sink the ship so their robbery would not be discovered. I also believe that the fire was set by the thieves as the best way to keep the passengers and crew distracted until the dynamite exploded. This chapter is dedicated to my speculation and the circumstantial evidence that I believe supports my contentions.

  WAS THE ROBBERY OF THE CLARA NEVADA TRULY ONE OF THE LARGEST IN AMERICAN HISTORY?

  Probably. But it is hard to compare recorded robberies simply on the basis of the booty. First, the value of money changes over time. Second, some robbers extract loot that is not convertible, which reduces the overall size of “the take.” Third, some robberies are unsuccessful because the loot is lost during the getaway or disappears forever through other circumstances. Finally, there have been robberies so clever that no one even knows they were committed.

  In terms of amount of money stolen, America has had its fair share of sizeable hauls. On September 18, 1877, Sam Bass snatched $60,000 in gold from a Union Pacific train near Big Springs, Nebraska. Eleven years later, George Leonidas Leslie dragged $2,747,000 out of the Manhattan Savings Institution. In 1921, Gerald Chapman and two accomplices stopped a mail truck between Wall Street and the New York Post Office and snatched thirty-three sacks of mail containing $1,424,129. In 1893, the Philadelphia Mint was burgled by its chief of weights clerk, Henry S. Cochrane, who got $130,000. And, in 1922, the Denver Mint was robbed of $500,000. In 1950, the infamous Brink’s Job netted $1.6 million. There have been other jobs netting the perpetrators into the millions of dollars, probably the largest being the Los Angeles robbery of the Security Pacific National Bank for $10.2 million on October 25, 1978.

  Comparing the $165,000 from the Clara Nevada to these, however, would be irrelevant. What is important is the distinction between the robbery of the Clara Nevada and those listed above. In all but one of the cases above, the perpetrators were captured. In the case of the Clara Nevada, up to the date of publication of this book, the thieves had escaped detection.

  HOW MUCH GOLD WAS ACTUALLY ON THE CLARA NEVADA?

  By weight, eleven thousand troy ounces of gold is more than nine hundred pounds of metal. It is logical to assume that the gold that was being brought south by those passengers who lived in Juneau would be in their staterooms. Juneau was only eight hours away, and these passengers may have felt no compelling reason to place their cache in the purser’s safe. But those passengers headed for points further south would have been compelled to secure the gold in the safe. Seattle was four or five days away. They could not stay in their sta
terooms every moment of that journey to safeguard their poke.

  Further, the $165,000 figure is for gold alone. At least one newspaper noted that there were “certified checks” onboard as well. A certified check from a Skagway bank in 1898 would probably be accepted in Juneau, but it is doubtful that the same instrument could be cashed in Seattle. Thus I speculate that most of the gold was in the purser’s safe. The Juneau passengers were probably carrying a certified check, a much safer means of transporting wealth.

  I doubt that the gold was sent as a single shipment. If it was, that would have meant that the entire amount was in the safe. This is unlikely. Most gold was transported on trustworthy ships with regular schedules rather than a tramp steamer like the Clara Nevada. Thus, I tend to believe that the gold was in the possession of individuals who had struck it rich in the Klondike.

  I also believe it would have taken more than one man to move nine hundred pounds of gold. Lastly, I believe it would have taken a senior crew member to get the gold out of the purser’s safe, either the captain or the purser.

  DID THE BOILERS EXPLODE?

  I don’t believe so. I believe that explosion was caused by a deliberately set dynamite charge. As there was a fireball and a blackened hole in the boiler room, it appears obvious that the explosion originated in the boiler room. While there could have been a fireball if the flames had touched off the ship’s supply of lamp oil, the conflagration would not have left a single, blackened hole in the boiler room. The ship would have burned to the water line and sunk.