Junius might have been less cautious, for Pierpont was clearly well prepared. Endowed with a powerful intellect, great financial insight, and enormous personal forcefulness, he enjoyed a growing following on Wall Street, and was praised by Dun’s credit service for conducting a “first rate” business. Over the years, Pierpont came to be known for a certain stiff rectitude—a Colonel Blimplike ethos that reduced to a harumphed “Gentlemen pay their debts.” His conventionality did not extend to his personal life. He displayed a surprisingly pre-Raphaelite sensibility by marrying a young beauty already dying of tuberculosis when he was twenty-four, suffering the inevitable bereavement four months later. His second marriage, in 1864, was a replica of his father’s—a powerful man in a cold marriage with a neurasthenic wife. Unlike his father, however, Pierpont had a succession of mistresses whom he never bothered to conceal from colleagues or family.
Morgan’s genius was that of the disciplinarian, not that of the creator. He was the last of the great eighteenth- and nineteenth-century merchant bankers, rather than the pioneer of a new dispensation. He did what his father and other bankers had always done, but in broader strokes, on a bigger canvas, applying his formidable intelligence to ever more complex financial constructions. His fundamental drive was toward order and control, and he was appalled by the storm of “creative destruction” at the heart of the long American boom. He detested “bitter, destructive, competition” that always led to “demoralization and ruin,” in the words of Elbert Gary, the Morgan man at U. S. Steel. Often strangely inarticulate, as if rendered speechless by the titanic fulminations in his breast, he railed against the madness for progress and change that wiped out perfectly respectable businesses of perfectly decent gentlemen, against the gale winds of technology that turned economic assumptions upside down and made it impossible for his clients to pay their debts! Over the course of forty years, he eventually succeeded as no one else in imposing his own iron will on the American economy, reining in the competitive free-for-all, and setting rules and boundaries that held sway for a half century after he died.
Carnegie, Rockefeller, Gould, and Morgan would have risen to the top in any age, as military leaders, perhaps, or as chancellors to kings. But in post–Civil War America, business had acquired the sense of excitement and purpose that men had once associated with great feats of statecraft or conquest.
It was no accident. The sheer size of America, and its already-impressive industrial base, made it ripe for hyperdevelopment. America was the only country where “worker” was a job description rather than a badge of class. Most Americans seem to have truly believed, just as Lincoln said they should, that their lives would get better, that there was no limit to the vistas to be opened by hard work and imagination. They chose the new almost as a matter of course—new things to buy, new inventions, new ways of making or growing things. It was to cast off the shackles of status, of artisanal guilds, of long-established trade practices, that they or their near ancestors had come to America in the first place. As a radically uprooted people, Americans shed ties of position and place as easily as old shoes. Contemporary observers were astonished that the pioneers pushing into western farmlands were not landless peasants but mostly successful farmers from Pennsylvania or New York, looking to move up to larger scale operations.
The freewheeling American style bequeathed a unique business heritage to an ambitious entrepreneur. Even well before the Civil War, some sharp-eyed Englishmen were becoming alarmed at the radicalism of American innovation.
2
“. . . GLORIOUS YANKEE DOODLE”
The steamer carrying Queen Victoria and Prince Albert pulled alongside the yacht America in tacit salute as it entered the last leg of an all-class regatta around the Isle of Wight on August 22, 1851. The royal couple then peeled off for home, for the only other sail in sight, seven and a half miles back, was the Aurora, a light, fast British cutter that should have easily out-sailed a schooner the size and weight of America. As the royal steamer passed near the shore, the question from the waiting public was: “Is the America first?” “Yes,” said the passengers at the rail of the steamer. “What’s second?” “Nothing.”
The sailing race—ever since known as the America’s Cup—was organized for maximum world attention as part of the “Great Crystal Palace Exhibition,” an unabashed self-celebration of a British nation at the top of its imperial game in the first full flowering of the Victorian Age. More than six million visitors gaped their awestruck way through the massive glass Exhibition Hall in Hyde Park. The hall, more than a third of a mile long and set among 12,000 fountain jets spurting as high as 250 feet, housed 13,000 exhibitions from all the civilized nations of the world. A great feat of engineering in its own right, the hall was constructed of more than a million machine-fabricated iron-framed glass sheets and erected in only twenty-two weeks.
Xenophobic English elites harbored doubts about the wisdom of such a display, worrying that London would be “overrun with foreign rogues and revolutionaries” and British “trade secrets stolen.” In fact, for knowledgeable industrialists and civil servants the implications of the Exhibition were far more unsettling than that. It was shameful enough that British yachtsmen had strenuously tried to avoid a direct contest with America—the London Times reporter said they acted like “wood pigeons or skylarks” who spot “a sparrowhawk on the horizon,” once they saw its training runs. But the news from the Crystal Palace suggested that “Brother Jonathan,” their bumptious American relative, was also developing an alarming superiority in advanced precision manufacturing, an arena in which Englishmen had thought themselves without peer.
On the very same day as the loss to America, an American succeeded in opening the famous, exquisitely crafted, and “unpickable” British Bramah lock—meeting a challenge that had stood for forty years. The lock-breaker was Alfred C. Hobbs, a talented huckster with an excellent understanding of machine manufacturing. He adroitly downplayed that his lock-breaking feat took more than two weeks, then offered $1,000 to any British locksmith who could open his own machine-made locks. When no one could meet his challenge, he collected the Exhibition’s lock medal and almost immediately made plans to open a factory in England.
Hobbs’s demonstration came just a few weeks after Cyrus McCormick’s reaper had decisively bested a feeble array of local competitors in a series of field tests. The usually anti-American Times, which had earlier derided McCormick’s machine as “a cross between a flying machine, a wheelbarrow, and an Astley chariot,” abruptly changed its tune: “the reaping machine from the United States is the most valuable contribution from abroad, to the stock of previous knowledge that we have yet discovered,” predicting that it would “amply remunerate England for her outlay connected with the Great Exhibition.”
But the praise heaped on reapers and locks was far eclipsed by the adulatory attention showered on Samuel Colt’s repeating firearm exhibit—even the Duke of Wellington, a regular visitor to Colt’s booth, was heard proclaiming the virtues of repeating firearms. Colt himself was invited to address the British Institute of Civil Engineers, the first American to do so; in a talk attended by leaders of the military and political establishment, he proclaimed the advantages of machine production over skilled craftsmen.
The yacht America crushed its British competition at the Great Crystal Palace Exhibition of 1851. It was just one of several alarming (to the British) demonstrations of American technical prowess.
In the meantime, the Vermont gun maker, Robbins and Lawrence, conducted a well-attended demonstration that proved that its machine-made rifles could be disassembled, their parts mixed up, and then randomly reassembled by an unskilled workman using only a screwdriver—a feat of “interchangeability” that British gunsmiths had long declared impossible. Robbins and Lawrence won the Exhibition’s firearms medal, while Colt, like Hobbs, let it be known that he too would open a plant to bring American technology to Great Britain.
It was sweet turnaround for the
Americans, whose exhibit had been widely derided for its emphasis on the boringly utilitarian—dubbed a desolate “prairie ground” amid “magnificent displays of Russian, Austrian, and French art.” Punch had first greeted the American exhibit with disdain— “their contribution to the world’s industry consists as yet of a few wine glasses, a square or two of soap, and a pair of salt cellars”—but gleefully switched to mocking punctured British pride:
Yankee Doodle sent to town
His goods for exhibition;
Everybody ran him down,
And laughed at his position;
They thought him all the world behind;
A goney muff or noodle,
Laugh on, good people,—never mind—
Says quiet Yankee Doodle.
CHORUS Yankee Doodle, etc.
. . . . . . . . .
Their whole yacht squadron she outsped,
And that on their own water,
Of all the lot she went ahead,
And they came nowhere arter.
. . . . . . . . .
Your gunsmiths of their skill may crack,
But that again don’t mention;
I guess that Colt’s revolvers whack
Their very first invention.
. . . . . . . . .
But Chubb’s [another British lockmaker] and Bramah’s Hobbs has pick’d,
And you must now be viewed all
As having been completely licked
By glorious Yankee Doodle.
CHORUS Yankee Doodle, etc.
The very disconcerting triumph of American technology was no accident, for it was the culmination of developments stretching back many years.
Rise of the Nerds
Thomas Blanchard was the classic nerd, a technology geek, but since he came of age in the Connecticut River Valley in the early 1800s, he was a machine geek. An indifferent student with limited social graces—he was afflicted with a bad stammer—his father early despaired of turning him into a farmer. Told to clear a field of stones, he was apt to mumble that it was a proper job for a machine, then spend his time designing one instead of digging up stones. As a teenager he was shipped off to work for his eldest brother who ran a tack factory—and Blanchard had found his milieu. His first job was hand-fixing heads on tacks, which he hated, so he invented a tack-making machine that turned out five hundred tacks a minute. After winning a patent for the tack machine, Blanchard sold the licensing rights for $5,000—a stupendous sum for a young man—and opened his own manufactory in Millbury, with “water privileges,” or the right to build a water mill to power his plant. Like a proto-Bill Gates, Blanchard not only had a genius for machines but was to prove an astute businessman besides.
Blanchard’s lasting fame is based on the “Blanchard gun-stocking lathe,” a truly original manufacturing breakthrough that dates from 1818, when he was thirty years old. Lathes, or “turning machines,” are among the oldest of machine tools, and were well known in both the ancient and medieval worlds. A piece of wood or other material is clamped in place lengthwise next to a fixed cutting blade. As the wood is turned by a handcrank or other power source, the blade inscribes a circular cut. Moving the wood back and forth on its long axis as it rotates against the blade will result in cylindrical shapes for table legs, pike staffs, and the like. Ornamental effects are achieved by adjusting the blade and the wood’s position to create bulges, cut deeper grooves, and so forth. Renaissance craftsmen achieved striking results using slides for smooth lengthwise motions and screw-based adjusters for precise placement of the blade. By the eighteenth century, rosette-cutting lathes were a popular entertainment for upper-class gentlemen and “royal hobbyists who enjoyed spending leisure hours creating intricate and pretty bibelots of wood, brass, ivory, or horn.” The great limitation of the lathe, of course, was that it was limited to objects with circular cross-sections or, at best, to elliptical shapes that didn’t depart too far from the strictly circular.
Blanchard’s gun-stock lathe arose from a consultation requested by Asa Waters, one of the Valley’s established armorers. Waters had patented a lathe that could cut a tapered gun barrel, but he could not solve the challenge of machining the breech-end of the barrel, where it flattened out and connected to the stock. The fact that Waters turned to Blanchard suggests that he was already a young man of considerable reputation. According to Waters’s son, who later was an important manufacturer in his own right, Blanchard listened to the problem, then “glanced his eye over the machine, began a low monotonous whistle, as was his wont through life when in deep study, and ere long suggested an additional, very simple, but wholly original cam motion . . . which upon being applied, relieved the difficulty at once, and proved a perfect success.” (A cam is an accessory that adjusts the path of the material or the cutting tool to create an ellipse or other noncircular curve.)
When Blanchard returned with the improved lathe, a delighted Waters said, “Well, Thomas, I don’t know what you won’t do next. I should not be surprised if you turned a gun-stock!” When Thomas stammered out that he would like to try, workmen who had gathered around the new lathe broke into guffaws. A gun-stock, in truth, is an intricate product that had long been a serious bottleneck at government armories. The wood stock has a variety of subtle curves along multiple axes, with dozens of recesses and connection points for the lock, barrel, and other metal parts, which in the early nineteenth century were all carved out by hand. A skilled team could turn out only eight to ten finished stocks a week. Intrigued, Blanchard mulled the problem, until one day on a trip home “the whole principle of turning irregular forms from a pattern burst upon his mind.” A neighbor reported that Blanchard stood in the road shouting, “I’ve got it! I’ve got it! I’ve got it!” while a passing farmer muttered, “I guess that man is crazy.”
The concept was as simple as it was brilliant. Blanchard constructed a lathe with two distinct parts, each separately powered. The first comprised the cutting tool, geared to revolve at a high speed, connected on a rigid frame to the “tracer,” which was just a freely moving wheel. The second part comprised the target block of wood, which was connected by a similar frame to a finished gun stock, or the “pattern.” The target block and the pattern had identical motions, rotating slowly while moving back and forth on their long axes. The tracer wheel rested against the pattern, while the cutting wheel rested against the wood block. As the pattern rotated and moved longitudinally, the undulations of the pattern pushed the tracer wheel back and forth, imparting the same action to the cutting wheel—and voilà, within just a few passes, the wood block assumed the shape of the pattern.*
Blanchard perfectly understood that he had solved a general problem: how to machine any irregular shape at all. He produced prototypes for a host of items that previously could be produced only by hand labor—shoe lasts (forms in the shape of a foot, an essential tool for shoe and boot factories), axe handles, plow handles, and wheel spokes. In a tour de force at the Paris Exposition of 1857, he executed a bust of the Empress Eugénie entirely by machine. He also proved to be a pioneer in patent management, doggedly fighting off imitations and carefully specifying the applications and the permissible territory covered by each license. Over a long life, he was credited with dozens of inventions, in almost every field that caught his restless fancy, including steam engine and steamboat technology. He died in 1865, at age seventy-seven, a sophisticated and well-traveled gentleman of considerable wealth. A eulogy said, “One can hardly go into a tool shop, a machine shop, or workshop of any kind, wood or iron, where motive power is used, in which he will not find more or less of Blanchard’s mechanical notions.”
The striking feature of Blanchard’s story, however, is not so much his invention but the reception it was accorded by the military establishment. Even before he finished his gun-stock lathe, he received a letter from the Springfield Armory—along with Harpers Ferry, one of the two government armories—asking what he was up to. Blanchard was to find himself the beneficiary of p
erhaps the American government’s first attempt at an “industrial policy.” The most direct analog may be the period of the 1950s and early 1960s, when the U.S. military was the primary support, indeed, occasionally the only customer, of the American semiconductor industry. During the cold war, the military sponsored high technology to counter the Soviet Union’s great manpower advantage; in the wake of the War of 1812, machine manufacturing was seen as a way to offset Great Britain’s much greater pool of skilled craftsmen.
Thomas Blanchard’s gun-stock machine was a radical manufacturing breakthrough. Both the pattern stock and the target wood block turned slowly and moved back and forth on their long axes. A tracer wheel followed the path of the pattern and imparted the same motion to a rapidly spinning cutting wheel. For the first time, highly non-regular shapes could be manufactured by machine.
When Blanchard’s lathe was ready, the armory arranged a series of demonstrations and tests at both Springfield and Harpers Ferry that consumed much of 1819. (Just transporting the machinery between Springfield and Harpers Ferry—from Massachusetts to rural Virginia—would have taken a month or more.) Discussions were put on hold through much of 1820 while Blanchard dealt with a patent challenge, although he also designed a companion machine to cut out the gunlock seating. Finally, in 1822, he and the government negotiated what we would now call a research and development contract. Blanchard would move to Springfield as an “inside contractor” and have the facilities and workers of the armory at his disposal. The government would pick up all the development costs of his machinery and pay Blanchard nine cents for each gun stock he produced. By the time he left the armory in 1827, besides having received $18,500 in Springfield patent fees alone, Blanchard had perfected a system of sixteen machines that carried out all of the multiple stocking operations with a minimum of manual intervention, including cutting and boring the fussiest of the pin and plate seatings. Blanchard’s production system was modernized and retooled twenty years later by Cyrus Buckland, one of the great Springfield supervisors, but the fundamental principles were unchanged.
The Tycoons: How Andrew Carnegie, John D. Rockefeller, Jay Gould, and J. P. Morgan Invented the American Supercompany Page 5
