The First Tycoon: The Epic Life of Cornelius Vanderbilt

by T. J. Stiles

  IT WAS A YEAR FOR WILLPOWER. In 1856, the sixty-two-year-old Commodore had to muster all of his famous force of mind to master the crisis—or crises, for the Accessory Transit Company represented only one of his many operations. In 1853, for example, he and Marshall Roberts had purchased the Vallecillo silver mine in Mexico, originally discovered by the Spanish but abandoned after Mexican independence. They had put to work a corps of men to reopen it, and in 1856 it produced silver again—at least $1,000 worth per day, with expenses of only $50 per day31

  Vanderbilt needed such resources in this year of trouble and strife. On March 23, one of his oldest and most valuable allies, Nelson Robinson, fell dead as he left church. The stock exchange closed early the next day in his honor, and Daniel Drew served as executor of his estate.32 Vanderbilt also suffered a setback in court in his fight to force the New Haven Railroad to acknowledge his “spurious” stock. And lawsuits against the Accessory Transit Company by empty-handed creditors multiplied. The Commodore took extreme measures to keep the company alive. He corresponded with Marcy and Pierce; he bought up $ 118,000 of the company's unpaid bonds (at ninety cents on the dollar); and he expended more than $400,000 of his own money to cover company expenditures.33 Now president, Vanderbilt drove White off the Accessory Transit board and brought in his son-in-law Cross, ally Frank Work, and various other trusted men.

  Troubles mounted. In June, after Garrison finally put his new Nicaragua transit line into operation, Pacific Mail halted its monthly $40,000 subsidy, refusing to pay for a monopoly that no longer existed. Then the U.S. marshal seized the Accessory Transit steamships in San Francisco for alleged indebtedness, forcing Vanderbilt to dispatch an agent to untangle that distant mess. He began to take personal ownership of the steamships as repayment for his advances, rather than let them fall into the hands of other creditors (which would have made them unavailable should he restart the line).34

  Remarkably, even in the midst of the Accessory Transit imbroglio Vanderbilt pursued his campaign against the Collins Line on the Atlantic. There, too, he faced enormous obstacles—none larger than the Adriatic, launched by Collins on April 7. It was the biggest ship ever built, nineteen feet and eight hundred tons greater than the Vanderbilt, though late design changes would keep it out of service for over a year. As the New York Times wrote, it was “at once a source of pride and mortification.”35 By contrast, Vanderbilt gave almost daily attention to his namesake ship as cranes at the Allaire Works lowered into the hull the twin engines, each 2,500 horsepower, and four boilers weighing sixty-two tons apiece.

  Late in July, the Commodore and several members of his family boarded his new steamship and set sail from New York. Despite the enormous size and power of the engines, “the one thing that struck us most strongly was the complete absence of all vibratory jarring,” one observer wrote—a testimony to expert construction. “Twenty-four firemen, 18 coal-heavers, 4 engineers, and 3 water-tenders minister to her capacity for the production of steam,” the New York Times reported, “while 8 cooks, 34 waiters, 3 porters, and an efficient steward” tended to the needs of its passengers. Apart from the family, the Vanderbilt carried no passengers, but it probably had its full compliment of cooks and waiters—for this was a lobbying trip.

  On July 22, the Vanderbilt dropped anchor off Greenleaf Point, where the Anacostia River poured into the Potomac. The next day, William H. Seward stood on the floor of the Senate and invited his colleagues to inspect the ship, to judge whether they should give the Commodore the European mail contract. “Immense crowds visited her,” the Times reported. Vanderbilt welcomed aboard representatives and senators, as well as President Pierce and his cabinet, who “were treated to a sumptuous entertainment on board.” The ship steamed home on July 27 to receive its finishing touches; the Commodore remained behind to press his advantage with Congress.

  The ship made a suitable impression. Congress was growing uneasy over the subsidy for the Collins Line, which failed to float the required number of ships. Collins alienated even his own lobbyists. “I am coming there in season to help defeat Collins this year,” wrote former House clerk Benjamin B. French. In August, Congress gave Collins notice that in six months it would roll back the subsidy increase it had previously granted. It was far from a complete victory for Vanderbilt, but it was progress.36

  BACK IN 1841, Captain William Comstock had observed that Vanderbilt wielded every possible weapon when in combat, that he strove for any possible advantage. This was never more true than in 1856. The war over the Nicaragua transit was proving more complicated, more perplexing, than any he ever had fought or would fight—even more than the struggle that had culminated in Gibbons v. Ogden. Cross had failed to prevent Garrison's defection; Birdsall had failed to forestall Morgan's start of the line; and Washington had refused his appeals for help. Indeed, this was far more than a metaphorical war, but a real war of guns and bullets, and it was not going well. Vanderbilt's Costa Rican allies had invaded, occupied the city of Rivas, and defeated another of Walker's frontal assaults on April 11, only to fall victim to a cholera outbreak that forced them to retreat.37 But the Commodore planned counterattacks on both the international level and the personal.

  On September 4, Garrison found himself under arrest. He was still in New York, where Accessory Transit filed a suit against him “for alleged frauds… amounting to over five hundred thousand” dollars (according to the Chicago Tribune), committed when he was the company's San Francisco agent. In the evening, after he posted the bail of $150,000, Garrison went to 10 Washington Place, where he tried to employ his wiles against the Commodore.

  “He insinuated that if I would participate with him and Charles Morgan… [in] the Walker grant… we could make a good business of it, to the exclusion of the Transit Company,” Vanderbilt reported. “My reply was, that my action in this matter had been wholly for the benefit of the Transit Company and its stockholders, and nothing could induce me to swerve from that course. At this he recoiled, and observed that he did not mean to make any insinuations of the kind.” Vanderbilt's choice of words says everything about his reaction to this proposition. To him, the word insinuate distinguished the talk of a crooked businessman from a “smart” but honest one. “I then told him he must clear up his character as regarded his conduct towards the company,” he wrote, “and when done, then I would be willing to refer his accounts to arbitration.”38

  Vanderbilt's reponse deserves notice, for he has been misunderstood by historians and contemporaries alike as an amoral creature, ready to seize the main chance under all circumstances. “His over-reaching disposition makes people shy of him,” R. G. Dun & Co. noted four years later. Undoubtedly he possessed immense personal force, and pursued his personal interests more aggressively than anyone; but he lived by a code, and despised those who did not. As president of Accessory Transit, he held a position of trust, and he drew heavily on his personal resources to fulfill his responsibilities. In his own mind, at least, he was ever a man of honor.39

  What is surprising is that so few others understood that. Everyone, it seems, tried to make Vanderbilt buy what had been stolen from him—even a friend of his, Domingo de Goicouria.* The fifty-one-year-old Goicouria belonged to a community of Cuban exiles in New York who plotted to free the island from Spanish rule. He had supplied Walker with Cuban independence fighters; in return, Walker named him minister to Great Britain, and ordered him to raise money in New Orleans on his way to London. Goicouria went to New York instead, where he discovered that Vanderbilt's enmity had frightened the city's merchants away from any connection with Walker. So Goicouria tried to convince the Commodore himself to buy the transit back—only to learn that Randolph had sold it to Garrison, much to Goicouria's outrage.40

  Walker completed the alienation of Goicouria on September 22, when he reinstituted slavery in a blatant attempt to gain money and recruits from the Southern states. The antislavery Goicouria retaliated by publishing Walker's letters in the New York Herald. They stagger
ed Walker's supporters, who had always believed that Nicaragua would be absorbed by the United States; now they learned that Walker hoped to forestall annexation, not only of Nicaragua but of Cuba as well. “Oh, no! that fine country is not fit for those barbarous Yankees,” he wrote of Cuba. “What would such a psalm singing set do in the island?”41

  The revelations also estranged the Pierce administration. Already it had withdrawn its recognition, after Walker named himself president; now the letters eliminated any chance it would reverse course. All this was good news for Vanderbilt. But Walker continued to attract significant support. A famous British soldier of fortune, Charles Henningsen, went to fight for him; Morgan sent artillery and ammunition by sailing ships, which the authorities did not inspect; and hundreds of recruits, many now from the South, still flocked to Nicaragua. But the Commodore had one more weapon to wield, one designed to turn the course of the war itself42

  Throughout the autumn of 1856, this drama played out in newspaper headlines and closed-door cabinet debates, in speeches on the Senate floor and noisy rallies. The nation's attention was simply riveted on Walker. But the public did not see Vanderbilt, as he secretly crafted a strategy to bring Walker down. It did not see Vanderbilt, as he quietly met with Costa Rican diplomat Luis Molina. It did not see Vanderbilt, as he quietly interviewed a tall, lean, sharp-chinned young man in a Panama hat, Sylvanus Spencer. It did not see Vanderbilt, as he quietly wrote instructions for Spencer, as he quietly dispatched him on a steamship to Central America in October.

  On October 15, the public got one quick glimpse of what went on in Vanderbilt's office. He testified in a lawsuit, one of the many against the Accessory Transit Company, and he spoke of his efforts to restore the corporation to possession of its property and its rights in Nicaragua. “I have corresponded with the Secretary of State and the President on the subject. The correspondence has continued till within the last two weeks, and is still in progress,” he said. “I think the property will come out right for the stockholders.… I have had but one opinion on the subject. I am devoting my own means to bring the matter out right.”43

  IT IS A REMARKABLE FACT that the only foreign conflict involving the United States during the fifty years between the Mexican and the Spanish-American wars was fought by a private army of American civilians. True, they claimed that they were the army of Nicaragua and that Walker was president of that republic; but the charade fooled no one. Indeed, this foreign interloper accomplished a feat that had eluded the victors of countless civil wars: he reconciled Nicaragua's Liberal and Conservative parties, when Tomás Martínez arranged for a unity government under Rivas to fight the filibusters. Their combined forces won their first victory at San Jacinto hill, where they captured and hung Byron Cole—the man who had first convinced Walker to go to Nicaragua.

  In many ways, Walker had been fighting for survival from the moment he executed General Corral. But in the summer of 1856 his situation grew more desperate. The allied army of some eight hundred Salvadorans, six hundred Hondurans, and five hundred Guatemalans had seized León on July 12, the very day that Walker declared himself president. There the advance halted as the allies squabbled.44

  Walker's own army consisted of the duped, the drunk, and the depraved. The troops lacked blankets, disease ran rampant, wages were nonexistent. Men who finished their terms of service were forced to remain. “Walker even posted sentries at the gangplanks of departing steamers to cut off the possibility of escape,” writes historian Robert E. May45 Walker's survival rested on one thing: a steady influx of fresh cannon fodder.

  In November, the Costa Ricans launched a second invasion in the south. This Walker saw as the paramount danger, since it threatened his access to reinforcements. As he later wrote, “It was all-important to keep the Transit clear.” On November 18, he decided to abandon Granada and fortify Rivas, which dominated the transit road.46 He left behind a force under Charles Henningsen with orders to destroy the city When the destruction began, the allies stopped dithering and attacked; close-range fighting raged in the streets for two weeks as the filibusters pillaged and burned. Walker finally returned with a steamboat, landed a relief force, and evacuated the embattled garrison. “Granada has ceased to exist,” Henningsen reported. On leaving the smoking metropolis, he erected a sign that read, “Aqui fue Granada”—“Here was Granada.”47

  By December 20, Walker had concentrated the bulk of his army at Rivas and garrisoned key points along the transit route: Virgin Bay, San Carlos, Castillo Viejo, and Hipp's Point, where the Sarapiqui River flowed into the San Juan. When he looked over his situation, he felt reassured. True, he had abandoned the northern provinces, but cholera had driven out an invading army once before. Most important, he was expecting large contingents of fresh troops, due at Greytown at any moment. “Walker, keeping his forces concentrated, can maintain himself in Rivas,” reported a U.S. naval officer who visited his encampment. “I have no hesitation in saying that if the external aids he has hitherto relied upon do not fail him, he will repel his enemies.”

  The key, of course, was the “external aids,” the filibuster recruits. On January 2, 1857, the steamboat San Carlos departed Virgin Bay, carrying passengers for New York; Walker expected it or La Virgen to return with his reinforcements from the east. “In a few days,” Walker wrote, “uneasiness was felt on account of the non-arrival of the steamers from the river.” There were any number of reasons why the boat might be late, he told himself, as he waited, and waited, and began to dread.48

  THE MAN WHO MADE WALKER WAIT was Sylvanus Spencer, acting on Vanderbilt's orders.

  Spencer was a man adrift on the tide of fortune. Orphaned when very young, he was taken in by a family in a tough part of New York's Thirteenth Ward. The New York Times would write, “His boyhood is presumed to have been a hard one—at least he came out of it a very hard boy.” He went to sea early on and rose rapidly in the often brutal society of sailors. As mate, he frequently punched recalcitrant subordinates. He talked freely and often, in a bit of a Yankee accent, as he strode the deck in his customary dark clothes and Panama hat.

  The tide that carried Spencer toward Vanderbilt began to rise back on April 25, 1855, at the very moment when Walker was preparing to embark on his invasion of Nicaragua. On that day, the square-rigged Sea Witch sailed out of New York Harbor. It belonged to Howland & Aspinwall, the mercantile house of William Aspinwall, and was bound for Hong Kong “to take a cargo of coolies for Panama,” the press reported. Its captain, by the name of Frazier, commanded a crew of twenty-three, and Spencer served as first mate. Once at sea, Frazier abused his mate, picking petty quarrels, giving demeaning orders, and belittling him in front of the men. On June 4, Spencer snapped. “By God, I took more from you this morning at the breakfast table than I ever did from any other man,” he shouted. “If I continue the voyage in this ship, or if you do not send me on shore out of this ship, either you or me will have to die.” The next morning, Spencer announced to the crew that he had found Captain Frazier bludgeoned to death in his bunk.

  On December 19, 1855, Spencer stood trial for murder in the U.S. District Court in New York. The jury found him not guilty because no one had witnessed the crime.49 But the incident seems to have made other ship captains reluctant to hire him, so he drifted to Greytown, Nicaragua. “He asked me if I had any employment for him,” Joseph N. Scott recalled. “He told me he was a sailor and would turn his hand to anything.” First Spencer labored as a stevedore; then Scott made him the mate on one of the river steamboats, the Machuca. As such, he learned the river and Transit Company operations well. After four months in Nicaragua, Spencer returned to New York.50

  At some point in 1856, he went to see Cornelius Vanderbilt. Spencer would later claim that he did so because he had inherited Accessory Transit stock from an uncle, but he may simply have been swimming with fortune's current. The Commodore would say nothing about their talk, but his calculations upon meeting Spencer are all too clear. His strategic assessment o
f Walker's situation had not changed, despite the failure of Birdsall's mission. If he could seize the steamboats on the San Juan River, he would block reinforcements from the Atlantic side. That also would stop passengers from crossing the isthmus, forcing Morgan and Garrison to withdraw their steamers (as they were not running a charity). He would, with one stroke, cut Walker off on both oceans. In Spencer, he found precisely the man for the mission. He was physically tough, accustomed to command, and, most important, intimately familiar with the terrain, the fortifications, and the steamboat operations. So Vanderbilt placed all his hopes—the fate of millions of dollars, of a critical channel of commerce to California, of a war involving six nations—in the hands of an acquitted murderer.51

  On October 9, 1856, Spencer departed New York for Costa Rica. He carried an agreement that Vanderbilt had made with Luis Molina, the Costa Rican chargé d'affaires in the United States. In San José, Spencer met with President Juan Rafael Mora and explained the plan that Vanderbilt had drafted—and how it would benefit them both. The Commodore would get his property back, and Mora would cripple Walker's army. Mora was no fool; such a plan had occurred to him before. But Spencer offered two things the Costa Ricans lacked: a detailed knowledge of the Transit operations, and $40,000 from Vanderbilt to pay expenses.52 Mora agreed to give Spencer some Costa Rican soldiers to carry out the mission; if he succeeded, General José Joaquín Mora, the president's brother, would follow with 1,100 men. If he failed, it would cost Mora little.

  Spencer marched north out of San José with a work detachment, crossing the mountains to the headwaters of the San Carlos River, which flowed northeast into the San Juan. He and his carpenters felled trees and lashed together several large rafts to carry his detachment. On December 3, President Mora formally placed 250 troops under the command of “Captain S. M. Spencer,” writing that they were “under your orders to carry out the military operations as you will think proper.”53