The First Tycoon: The Epic Life of Cornelius Vanderbilt

by T. J. Stiles

  4 The literature on Jacksonianism is vast. Unfortunately, even some of the best historians display a tendency to frown on Jacksonians as regressive or reactionary; see, for example, John Lauritz Larson's otherwise superb discussion in Internal Improvement: National Public Works and the Promise of Popular Government in the Early United States (Chapel Hill: University of North Carolina Press, 2001), 149–93, esp. 150, 192. In my claim that both Jacksonians and anti-Jacksonians favored markets, entrepreneur-ship, and development, I am in agreement with Howe, esp. 364, 501, and Connolly, 14. James L. Huston, Securing the Fruits of Labor: The American Concept of Wealth Distribution, 1765–1900 (Baton Rouge: Louisiana State University Press, 1998), 83–151, offers a very insightful discussion of American economic culture (the “republican theory of wealth distribution,” as he calls it), stressing that the antebellum economy was dominated by horizontal expansion and small producers, despite the attention given to industrialization. Sean Wilentz, The Rise of American Democracy: Jefferson to Lincoln (New York: W. W. Norton, 2005), 438, argues, “The Jacksonians opposed large government not because it burdened business but because they believed it was a creature of the monied and privileged few.… They aimed not to liberate private business interests from a corrupt government, but to liberate democratic government from the corrupting power of exclusive private business interests.” This was unquestionably true, but they clearly wished to liberate individuals as economic actors from the unfair advantages of the wealthy “aristocracy;” laissez-faire was both an economic means to a political end and a desired economic end state. One of the most influential books to this day remains Marvin Meyers's The Jacksonian Persuasion: Politics and Belief (Stanford: Stanford University Press, 1960), which argues, 7–15, that the Whigs and the Democrats were “fraternal twins” in their faith in the market economy, but that Democrats conjured up “moral plots” to rally their followers. I believe that Meyers, as insightful as he is, fails to appreciate how seriously Jacksonians took the threat that government action might give rise to a privileged class.

  5 “President Andrew Jackson's Veto Message Regarding the Bank of the United States, July 10, 1832,” in A Compilation of the Messages and Papers of the President (New York: Bureau of National Literature, 1897); Daniel Webster in Krooss, 787–8.

  6 Sellers, 324, 336; Huston, 134; William M. Gouge, A Short History of Paper Money and Banking in the United States (Philadelphia: T. W. Ustick, 1833), 42, 833–4; 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. For insight into the Jacksonian hatred of the artificial, see Lawrence Frederick Kohl, The Politics of Individualism: Parties and the American Character in the Jacksonian Era (New York: Oxford University Press, 1989), 35–8. Wilentz, Rise of American Democracy, 440–1, argues that hard-money Jacksonians were emphatically not economic primitivists who “aimed at turning back the clock,” and often were as sophisticated as their opponents. There is a great deal of truth to this, yet I believe that Wilentz downplays their discomfort with economic abstractions. Even corporate figures had difficulty grasping them, as will be seen in later chapters of this book. However, I agree with Wilentz's argument, 511, 513, that Jacksonians envisioned a commercial economy of agricultural small producers, and distrusted speculation and credit.

  7 EP, August 28, 1834; James Willard Hurst, The Legitimacy of the Business Corporation in the Law of the United States, 1780–1970 (Charlottesville: University Press of Virginia, 1970), 30–43.

  8 Huston, 134, 251–5; Pauline Maier, “The Revolutionary Origins of the American Corporation,” WMQ, 3rd ser., vol. 50, no. 1 (January 1993): 51–84; EP, August 28, 1834; Gouge, 41–2. Ashworth notes correctly that Democrats embraced self-interest, Adam Smith, and laissez-faire, but argues incorrectly, in my view, that they could be summarized as “anti-entrepreneurial” and agrarian (e.g., 21, 51). Naomi R. Lamoreaux shows (as my own research does as well) that early corporations only slowly took on the characteristics cited here; see “Partnerships, Corporations, and the Limits on Contractual Freedom in U.S. History.” The abstraction of economic reality and the cultural shock it induced is one of my central themes. On this topic, see Daniel J. Boorstin, The Americans: The Democratic Experience (New York: Random House, 1973), 414–6, who discusses “a new mystery, a new unintelligibility” of corporations—“this new metaphysic of property,” as he calls it. Boorstin, however, focuses on the late nineteenth century, whereas I believe this was felt decades earlier. Joseph A. Schumpeter discusses the “evaporation of the substance of property” in Capitalism, Socialism, and Democracy (New York: Harper &Brothers, 1942), 156–8.

  9 Krooss, 1026–7; Huston, 252; A. B. Johnson, “Advantages and Disadvantages of Private Corporations,” MM, December 1850, 626–31 (italics added); Gouge, 42. Taylor, 242, offers an excellent brief discussion of the controversy over corporations, as does Kohl, 66, 96, and Ashworth, 79. The law also insisted on the centrality of the persons behind corporations; see Mark, “Personification.” Meyers, 11, astutely notes, “Americans were boldly liberal in economic affairs, out of conviction and appetite combined, and moved their world in the direction of modern capitalism. But they were not inwardly prepared for the grinding uncertainties, the shocking changes, the complexity and indirection of the new economic ways.”

  10 Burrows & Wallace, 571–5; EP, November 13, 1833; NYW, November 14, 1877; Sellers, 332–7; Hone, 110–2. See also NR, November 2, 1833.

  11 Howe, What Hath God Wrought, 537–36, esp. 582–84; Daniel Walker Howe, The Political Culture of the American Whigs (Chicago: University of Chicago Press, 1979), esp. 9–20, 181; Amy Bridges, A City in the Republic: Antebelleum New York and the Origins of Machine Politics (New York: Cambridge University Press, 1984), 19–24; Meyers, 12–5; Michael A. Bernstein, “Northern Labor Finds a Southern Champion: A Note on the Radical Democracy,” in William Pencak and Conrad Edick Wright, eds., New York and the Rise of American Capitalism: Economic Development and the Social and Political History of an American State, 1780–1870 (New York: New-York Historical Society, 1989), 147–67. As L. Ray Gunn notes in “The Crisis of Distributive Politics: The Debate over State Debts and Development Policy in New York, 1837–1842,” Pencak and Wright, 168–201, the Democratic Albany Regency made active use of the state to promote development. Ashworth offers an astute interpretation of the Whig orientation, 54–68, and the Federalist legacy, 117–8. My view that many Whigs were suspicious of competition will be developed over the succeeding chapters.

  12 NYW, November 14, 1877; EP, August 30, 1834, February 10, 1837. On CVs address at this time, see Croffut, 279.

  13 EP, August 30, 1834, September 10, 1833; Albany Argus, March 15, 1834; Charles Hoyt v. John Brooks Jr. and Others, May 8, 1833, file BM 2163-H, Court of Chancery, and James Ingham and James Leslie v. CV, December 15, 1834, file 1834-#756, Court of Common Pleas, NYCC. On the Water Witch, see also New York Illustrated Magazine of Literature and Art, September 20, 1845.

  14 Robert Stevens's brother, John C. Stevens, remained a member of the association. See Articles of Agreement between Robert L. Stevens and John C. Stevens, Anthony N. Hoffman, et al., December 1, 1832, fold. 13, box 34, Stevens Family Papers, New Jersey Historical Society, Newark, N.J. The agreement was made with Anthony N. Hoffman, Michael Van Beuren, Smith Cutter, James Mason (owners of the Ohio, the Constellation, and the Constitution), Alsop Weed, Griffith P. Griffith, Le Grande Cannon (owners of the Erie and the Champlain), James A. Stevens (owner of the Albany), and Robert Dunlop (owner of the DeWitt Clinton).

  15 Albany Argus, March 15, 1834, November 23, 1835, April 16, 1836; Gunn, 30; Martin Bruegel, Farm, Shop, Landing: The Rise of a Market Society in
the Hudson Valley, 1780–1860 (Durham: Duke University Press, 2002), 159–63; Morrison, 46, 68. CVs account appeared in a front-page advertisement in EP, August 30, 1834.

  16 EP, August 30, 1834.

  17 EP, August 28 and 30, 1834. On Leggett's new control of the Post and the Locofoco faction of Democrats with which he was aligned, see Burrows & Wallace, 518–22, 606–9, 621–5; Wilentz, Chants Democratic, 145, 235; Ashworth, 94–6. Connolly notes in his introduction that Jacksonian Democrats distinguished between enterprising businessmen, whom they favored, and “capitalists,” another word for stockjobbing speculators, whom they condemned.

  18 Albany Argus, July 17, 1834; New-York Mirror, September 27, 1834.

  19 Albany Argus, July 17, September 2, 1834; New-York Mirror, September 27, 1834; entries for September 14, 16, 1834, Hone ms.; Heyl, 5:203–5. Morrison, 68, reports that racing steamboats made “flying landings,” putting passengers in a boat attached to a line and then sheering off, giving the passengers seconds to get out of the boat at the dock before the line yanked it away. Hone's description casts doubt on this, though landings were clearly rushed. The Albany Argus, October 23, 1835, reported that the Champlain, on the fastest-ever trip between New York and Albany, lost an average of two minutes for each landing, enough for a hurried stop at a pier.

  20 Albany Argus, September 2, 3, 1834; Albany Evening Journal, November 7, 1834, March 27, 1835.

  21 NYH, May 3, 1839; NYT, February 9, 1859. As will be seen, Daniel Drew adopted the People's Line name in June 1835 and began his own attack on the monopoly, eventually becoming its chief. See Cincinnati Mirror, May 16, 1835, and advertisements in the Albany Argus and Albany Evening Journal through 1835.

  22 EP, June 4, 1835, January 20, 1840; NYTr, March 7, 1878; New York Review, July 1838.

  23 EP, June 4, 1835, January 20, 1840; NYTr, March 7, 1878; New York Review, July 1838; Heyl, 5:167–9. Bishop and Simonson's shipyard was at the foot of Walnut Street; John H. Morrison, History of the New York Ship Yards (New York: Sametz & Co., 1909), 59. For Charles Simonson's marriage to Mary Vanderbilt, Cornelius's oldest sister, see Staten Island Church Records, 174. For an excellent account of steamboat and steamship construction, and an explanation of “hog” and “sag” problems, see Cedric Ridgely-Nevitt, American Steamships on the Atlantic (Newark, Del.: University of Delaware Press, 1981), 105–6.

  24 The most forceful advocate of the notion that cotton drove the American economy is Douglass C. North, The Economic Growth of the United States, 1790–1860 (New York: W. W. Norton, 1966), 66–74; see also 102, 113–7, 122–9 (quote on 129). On the “cotton triangle” between New York, Southern ports, and Europe, see Philip S. Foner, Business and Slavery: The New York Merchants and the Irrepressible Conflict (Chapel Hill: University of North Carolina Press, 1941), 6–14; Albion, 95–121. Wilentz, Chants Democratic, notes, 108, “the rising dominance of antebellum New York over American trade and finance is still staggering to contemplate.”

  25 For a capsule history of the rise of manufacturing in Massachusetts, see Kinley J. Brauer, Cotton Versus Conscience: Massachusetts Whig Politics and Southwestern Expansion, 1843–1848 (Lexington: University of Kentucky Press, 1967), 8–11, and Taylor, 229–49. Banker William D. Lewis of Philadelphia wrote to James N. Paige and James K. Mills, two commission merchants of Boston, December 1839, “The South & West require a certain quantity of your fabrics. The two greatest points of distribution are New York & this city,” fold. 6, box 2, WDLP. New York also took large shipments of boots, shoes, and hats from New England; on March 18, 1842, WmC wrote to COH that “a large proportion of the freight is shoes and straw bonnets,” fol. vol. 2, CFP. On the rise of finished textile manufacturing in New York, see Wilentz, Chants Democratic, 107–16.

  26 Larson, 225–9. For more on early railroads and government attitudes toward them, see Taylor, 72–101. Alfred D. Chandler Jr. and Stephen Salsbury note that, as of 1850, only forty-one factories had a capitalization of $250,000 or more, though railroads routinely were capitalized at over a million dollars; “The Railroads: Innovators in Modern Business Administration,” in Bruce Mazlish, ed., The Railroad and the Space Program: An Exploration in Historical Analogy (Cambridge, Mass.: MIT Press, 1965), 128–30. See also Edward Chase Kirkland, Men, Cities, and Transportation: A Study in New England History, 1820–1900, vol. 1 (Cambridge, Mass.: Harvard University Press, 1948), 111–4, 223–58; MM, December 1846.

  27 Entry for April 11, 1836, Hone ms. Kirkland notes, 244, that in 1835, when the Boston & Providence was completed, four of its seven directors (including its president) were New Yorkers, and that 97 percent of its stock was held outside of Boston, most of it in New York. Hone noted in his diary on June 17, 1835, “A majority of the board are citizens of New York;” Hone ms. For details of the specie and bank bills carried by a typical Long Island steamboat, see a report on the loss of the Lexington in the EP, January 18, 1840, and stories about thefts, ProvJ, September 21, 1836, and NYH, October 3, 1836.

  28 Kirkland, 121–6, 244; Morrison, 270; ProvJ, June 16, 1836; EP, January 20, 21, 24, 1840; Heyl, 2:139, 5:167–9. On the cost of the Lexington, see also CtP to WDL, April 22, 1838, fold. 2, box 2, WDLP.

  29 EP, June 4, 1835, January 21, 1840; New York Review, July 1838; Kirkland, 1:23, 244; Morrison, 270; Statement by the Boston and Providence Rail Road Corporation in Explanation of their Proceedings in Relation to Steamboats (Boston: John H. Eastburn, 1838); A Replication to a “Statement by the Boston and Providence Rail Road Corporation in Explanation of their Proceedings in Relation to Steamboats” (n.p., n.d.). To put the Lexington's speed in context, see Taylor, 71, who notes, “The average rate of speed even of the faster steamboats before the Civil War was seldom greater than fifteen miles an hour.”

  30 Entry for June 17, 1835, Hone ms.; Kirkland, 1:23–4, 243–5; BE, April 21, 1842. The Lexington was also listed as a connecting boat to the railroad to Boston from New York in J. H. Colton, Guide to Burr's Map of New York and Steam-Boat, Stage, Railroad, and Canal Register, &c., &c., &c., for the year 1835 (New York: J. H. Colton, 1835), 33. On the rise of Connecticut as a manufacturing state, see MM, December 1846. On fares, see ProvJ, April 8, May 28, October 4, 1836.

  31 ProvJ, July 2, 1836.

  32 EP, January 21, 1840; ProvJ, July 2, 1836; Charles Dickens, American Notes for General Circulation (New York: Penguin, 2000, orig. pub. 1842), 88. On interior accommodations of steamboats, see Kirkland, 1:24; ProvJ, October 13, 1836; and entry for April 11, 1836, Hone ms.

  33 ProvJ, June 15, 1836; JoC, October 25, 1837; WmC to COH, July 31, 1841, fol. vol. 2, CFP; Edwin L. Dunbaugh, Night Boat to New England, 1815–1900 (Westport, Conn.: Greenwood Press, 1992), 28–9, 41–2; Nestor Houghton v. CV, August 10, 1837, file BM V016-H, Court of Chancery, NYCC. The $74,000 price was equal to the net profits of the ferry for the preceding four and a half years. The purchasers, John H. Smith, Edward Kellogg, George Gault, Nestor Houghton, George Lock-wood, Robert T. Haws, and Ephraim Corning, paid $10,000 in cash, plus six-, ten-, and eighteen-month promissory notes at 6 percent interest. CV agreed to supervise the installation of new boilers, and received free passage for himself and his family on the boats. The agreement specified that the boats could not be run on the North River above New York, where CV had a line, but CV might have intended to prevent another conflict with the Hudson River monopoly.

  34 ProvJ, June 15, September 21, October 3, 4, 12, 13, 1836, March 20, 22, 1837; EP, March 21, 1837.

  35 Entry for April 11, 1836, Hone ms.; New-York Mirror, November 12, 1836; ProvJ, July 14, 1837.

  36 CV to JWR, November 1836, RWG; Kirkland, 276–9.

  37 ProvJ, January 23, 1837; JWR to CV, January 24, 1837, CV to JWR, January 30, 1837, CV to John Whipple, April 8, 1837, RWG; Statement by the Boston and Providence Rail Road Corporation; A Replication; Kirkland, 276–9.

  38 NYW, November 14, 1877; NYS, November 13, 14, 1877; NYTr, March 28, 1878. On CVs new address, see the return address on CV to JWR, November 1836, RWG. It was the
n a respectable neighborhood, despite its proximity to Corlears Hook; see NYT, January 11, 1886.

  39 Hone, 185–9; Burrows & Wallace, 596–8.

  40 Burrows & Wallace, 598–602; Peter Temin, “The Jacksonian Economy,” in Edward Pessen, ed., The Many-Faceted Jacksonian Era: New Interpretations (Westport, Conn.: Greenwood Press, 1977), 102–13; North, 198–201; Sellers, 338.

  41 NYH, October 5, 1836; Burrows & Wallace, 529–41; Patricia Cline Cohen, The Murder of Helen Jewett: The Life and Death of a Prostitute in Nineteenth-Century New York (New York: Alfred A. Knopf, 1998), 61, 66, 104–5. A reference to businessmen playing whist about this time appears in J. R. Ingersoll to WDL, May 7, 1841, fold. 2, box 1, WDLP.

  42 Burrows & Wallace, 567–9; Walter Licht, Working for the Railroad: The Organization of Work in the Nineteenth Century (Princeton: Princeton University Press, 1983), 9; James Guyon and CV v. Moulton Bullock, James W. Otis, and Jonathan Prescott Hall, March 16, 1838, file BM 1404-G, CV v. John Martineau and Eliza, His Wife, and Anna B. Cook, Executrix of Richard M. Cook, Deceased, September 13, 1839, file D CH 100-V, CV v. John W. DeGrauw and Jane, His Wife, Walter N. DeGrauw, John J. Stephens, and Others, May 30, 1839, file D CH 104-V, Court of Chancery, NYCC. I speculate that he made other loans since these are only known because the borrowers defaulted; repaid loans do not appear in surviving records.

  43 Sellers, 344; Hone, 228; North, 198–201. Temin sharply disputes the impact of Jackson's policies, though they undoubtedly contributed to the atmosphere of uncertainty.

  44 NYS, November 13, 1877; NYT, November 14, 1877; JWR to CV, January 24, 1837, RWG.