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After the business crackup of 1857, as Ohio historians observe, the public in that state manifested a more critical attitude towards railroads than before. As was the case everywhere, the visions of both parties had been too roseate, and too much had been expected of the rails. Every village had expected, through their magic, to become a city and every poor man a millionaire. Some promoters had of course made reckless promises. Cities, counties, and towns lost heavily on their stock and bonds subscriptions. Despite the lift given by the Civil War, less than 17 percent of the total mileage in Ohio had paid any dividends by 1868.
The four years of war diverted people's attention from these complaints and created war's usual factitious prosperity. The northern rails were cashing in, not only on war business, but some of them from the newly discovered Pennsylvania oil, and thereby mixed a brew of odium whose reek has not yet been dissipated. But the war — again like other wars, including our most recent one — brought out the worst in the human animal, gave him opportunity and even stimulus to cheat, graft, steal and reveal the superficiality of our so‑called civilization.
The Ohio State Railroad Commission's report for 1868, quoting "a high railroad official" in criticism of station agents, supply agents, assistant superintendents, masters of transportation, etc., said:
They give empty cars to favorites for a sly consideration. They are co-partners with those who contract for wood, lumber, ties and all manner of supplies, themselves acting for the company both in purchasing and accepting said supplies. They share in the profits of those who ostensibly run the stock-yards and railroad hotels. They receive gratuitously shares in the sleeping-car p281 company, express and freight companies, with which they make contracts and monthly settlements to large amounts as agents of the railroad companies.
From little to more and from low to high, they become a trained band, noticeable for their proper deportment, silent attention to business and for their large fortunes soon acquired. . . .
All these things were producing movements in opposition, many of them crack-brained, of course. In 1867, Lorenzo Sherwood launched the National Anti-Monopoly Cheap Freight Railway League, and got himself elected president of it. His plan called for the creation of seven double-track railroad systems, covering •4,000 miles, at a cost of $200,000,000 over which any company or individual might operate cars, just by paying tolls — a notion long since exploded, but some people never seemed to learn. A more serious event was the birth in that same year of the Grangers — whose real name was, Order of Patrons of Husbandry, and whose stated objects were fraternity, education and social help; but who later drifted into politics and became critics of the railroads. The doings of Horace Clark and some others of his ilk immediately after the war did nothing to discourage these movements.
When Commodore Vanderbilt in that summer of 1869 went by special train to Buffalo and Cleveland to consult with prominent stockholders involved in the great amalgamation which gave birth to the Lake Shore & Michigan Southern Railroad, the press immediately guessed that "a consolidated Vanderbilt line between New York and Chicago is a certain event of the future." But the Commodore was as yet by no means in the driver's seat. Legrand Lockwood, elected treasurer of the new corporation and with ambitions of his own to be a magnate, was still the dominant figure. The newspapers now began to hear of frequent conferences between Gould and Lockwood, and to report that "The Erie clique wined and dined the Michigan Southern party at Delmonico's." It appeared that Lockwood was maneuvering to make the most of his strategic position. The financial expert of the New York Herald commented that the Lake Shore now "could coquet with either the Central or the Erie. . . . Originally the plan was to connect Chicago with New York; but the stockholders of the western roads have reversed the programme and are uniting New York to Chicago." Gould's poverty-stricken Erie had, however, weaker inducements to offer than the Central. In p282 desperation, it too reversed a program and promised to lay a third rail all the way from Buffalo to Jersey City, to enable standard gauge trains from the Midwest to operate over it.
Vanderbilt owned considerable blocks of Michigan Central and Great Western stock, which gave him an alternate line from Buffalo to Chicago, and he now chose to appear indifferent to the Lake Shore situation. He spent the late summer at Saratoga, seemingly more interested in race horses than railroads; but the Herald shrewdly surmised that he had not forgotten his "pet scheme." Early in September the guess was proven accurate when Lake Shore shares dropped from 120 to par, the result, so the Herald said, of the Lake Shore's "playing false" with the Central and allying itself with Erie:
The veteran Commodore is an unrelenting enemy. He bided his time. He waited until the Lake Shore party were loaded up with stock in furtherance of their plan of a continuation to New York by a third rail over the Erie road. He started the ball a week go last Monday by throwing overboard all the Lake Shore stock held by the Central company.
When Lake Shore stock had been driven down to 95, with selling still continuing, of it by shorts who were making hay while the sun shone, the Lockwood crowd made peace overtures to the Central. Before anything definite was done, however, Black Friday, September 24, 1869, the end of the Fisk-Gould effort to corner the gold market, dawned over Wall Street. When the gold corner collapsed about noon, stock prices declined still further, as brokers were forced to throw shares on the market to save themselves. Lockwood & Company, loaded to the gunwales with Lake Shore stock, for its own account as well as for its customers, had borrowed money from the railroad's till to help it in carrying the burden. When LS stock continued its nose-dive to 75, the Lockwood firm's reserve was gone, and after a quarter-century of unblemished repute in Wall Street, it was forced to suspend payment. Lockwood himself was so pinched that to cover personal borrowings from the Lake Shore treasury, he gave a mortgage on his country home in Connecticut.
During the Black Friday panic, NYC stock declined from 200 to 145, but that still left it about the top of the market. Here was Vanderbilt's opportunity. Through his brokers he borrowed $10,000,000 from Baring Brothers of London, giving a block of NYC & HR stock as collateral, and bought securities of all p283 the Vanderbilt rails, but especially of the Lake Shore, picking up, it is said, 70,000 shares of that one alone. By the end of September he was in control. A new regime now having taken over, Lockwood resigned as treasurer and was succeeded by Vanderbilt's man, James H. Banker. Stocks all now moved upward, and in a few months Lake Shore was back at par. In the election of 1870, Horace Clark, as predicted, became president (the Commodore bitterly regretted this later), Augustus Schell, vice-president, Banker continuing as treasurer. Through traffic arrangements with the NYC now became more closely integrated than ever.
But having become an executive, young Horace Clark — he was now 55, but in some of his thinking and by comparison with his father-in‑law, he seems surprisingly youthful — was determined to shake off the old man's yoke which had so long chafed him, and do some stunts on his own. The difference between him and the Vanderbilts was that he was primarily a stock market operator, not a railroad man — which explains why he so soon entered into an alliance with Gould. He and Schell were with that gentleman in a Chicago & Northwestern corner in 1872, and all cleared nice little sums on it. About the same time the Erie Railroad expelled Gould from its presidency and had him arrested on a charge that he had fraudulently misapplied more than $9,000,000 of its funds, whereupon Clark went on his bail bond. Fancy how Papa Vanderbilt must have liked that!
Now flying high, Clark took the presidency of the Union Pacific away from Thomas A. Scott of the Pennsylvania in 1872, when the stock of the UP, still in disgrace because of the scandals in its construction, was down to 30. The Vanderbilt interests were now well represented on western railroad boards — H. H. Baxter in the Northwestern, Clark in the Union Pacific, Clark and Schell in the Toledo, Wabash & Western, and Daniel Torrance, another son-in‑law, and general superintendent of the New York Central, in the Ohio & Mississippi.1 Clark and the brothers, August and Richard Schell, were all executive officers in the Union Trust Company of New York, and had its money to play in all sorts of bullish speculation. The flashy rises in Clark stocks were contrasted p284 with the stodgy steadiness of New York Central, "in the control of which," said the Herald, "the venerable Commodore is to be left in childless isolation by his ungrateful and faster sons-in‑law." But tears were wasted on the venerable Commodore, who at seventy-six could have tied knots in any son-in‑law or practically any other contemporary.
It was during Clark's Lake Shore regime that the most unpleasant series of incidents in its history took place. The great northwestern Pennsylvania oil field was opened up in 1859. The original Lake Shore had leased the Jamestown & Franklin Railroad, in the oil region, in 1864 and connected it by a branch with the main line at Ashtabula. It also still controlled the Franklin Canal Company, and in 1872 took over, under 501‑year lease, the Dunkirk, Allegheny Valley & Pittsburgh, pieced together out of three smaller roads and leading from Dunkirk down to Warren and Titusville, two of the biggest of the oil centers. The Lake Shore was therefore knee-deep in oil; the other two fortunate roads were the Pennsylvania and the Erie.
There were a number of oil refineries close to the wells, but Cleveland became a great center of refining, and in the latter 1860's a pious entrepreneur named John D. Rockefeller was rising to eminence in that business. The plants of Rockefeller, Flagler & Andrews grew to be the biggest in Cleveland, and in 1870, it became the chief unit in the million-dollar Standard Oil Company. The Lake Shore, having then the only direct route from the heart of the field to Cleveland, had the best business of the three chief competitors. But as the oil business increased, competition among the trio was intensified to such an extent that rates became as fluid as the product they handled. "In 1871," wrote Ida Tarbell in her history of Standard Oil, "any big producer or refiner could bully a freight agent into a special rate." Thomas A. Scott, vice-president of the Pennsylvania Railroad, testified before a Congressional Investigating Committee in 1872 that the railroads had been "cutting each other" on oil rates for years and hadn't made any money out of the business. It seemed to be like the liquor habit. They had tried time and again to make an arrangement among themselves, but always failed. There were no rate laws then, no Interstate Commerce Commission to keep these gray-haired little boys from fighting each other.
In this situation, John D. Rockefeller approached the three railroads with an idea. He was organizing the South Improvement Company, a group of refiners "for mutual benefit and protection;" p285 he promised enormous shipments by its members in the near future, and he suggested a special, though secret, rate for members; the published rates were to remain the same, but the members of the Improvement Company were to be given rebates.
The representatives of the three railroads, when this proposition was first presented to them in conference, at first drew back in distaste. Rockefeller and associates pressed their case, representing that the South Improvement Company would include practically everybody. As W. G. Warden, one Rockefeller's mouthpieces, admitted to the Congressional Committee, the railroads "did not want to give us a rebate unless it was with the understanding that all the refineries should be put into the arrangement and placed upon the same level." They were assured by the slick-tongued Rockefeller that this would be done. Then Tom Scott insisted that it was only fair that the producers, owners of the wells, should be included in the arrangement, too. This the gang had not intended doing, and a long argument ensued. Finally, the oil men exchanged glances and drew up in pencil a draft of an agreement which included the producers; but this was done only to pacify Scott for the time being; it was never put into effect and wasn't intended to be.
There were some railroad men, it is true, who were more easily persuaded. When the Standard Oil Company on January 1, 1872, increased its capital from $1,000,000 to $2,500,000, among the new stockholders were Truman P. Handy, Stillman Witt and Amasa Stone, Jr. (he would be in it, of course), all officials of railroads centering in Cleveland.
Miss Tarbell says very fairly that in the beginning the railroads had no desire to put an oil monopoly into the hands of Rockefeller and his associates, but Rockefeller bludgeoned them into it. With an agreement from them in his pocket, he began to put the screws to the other refiners not in his trust, and gradually forced most of them, after some years of struggle, to sell out to his trust, often at one-half or one-third of the real value of their businesses. The disingenuousness, to put it mildly, of his public professions on the subject is shown by his testimony to the Congressional Committee:
A public rate was made and collected by the railroads, but so far as my knowledge extends, seldom retained in full; a portion was repaid the shipper as a rebate. By this method the real rate of freight which any shipper paid was not known by his p286 competitors nor by other railroads, the amount being a matter of bargain with the carrying companies.
George W. Alger, in an article in McClure's Magazine2 in its muck-raking days, while criticizing the railroads severely for their part in the scandal, yet saw the difficulties and the human weaknesses involved in their position:
The railroads were fighting for a chance to live. They were interstate railroads, and there was no federal legislation of any kind governing them. They could not agree among themselves as to rates, and competition among them was ruinously intense. They needed control by law, and there was no law on the federal statute books which governed them. Such state laws as there were did not apply to interstate commerce, were weak and insufficient.
They must do something. They had millions of dollars invested in their rights of way, in their tracks and rolling stock. They had to do business, carry on this enormous oil traffic, even at a loss. Not one of them was willing to move its business out of the Oil Regions like a disappointed grocery or a discouraged saloon. But with cut-throat competition, they could make no money. What could they do? The Oil Trust furnished the answer. . . . Where there is an economic condition which absolutely requires a law and the state fails to provide it, somebody else will. The schemers for an oil monopoly furnished that law.
There is every evidence that most railroad officials did not like the imbroglio, but once started, the scandal continued for years. It even spread to other products than oil; there is still alive an occasional veteran who recalls informal arrangements under which envelopes were tossed by unseen hands through half-opened transoms into offices of shippers who were expecting a kickback. Honest railroad men were really relieved when the Interstate Commerce Commission gained sufficient power to correct such practices. But by that time John D. Rockefeller was a multimillionaire and was beginning to think of giving away some of his money for the public good.
Horace Clark had his finger in many pies. In September, 1871, he, Schell and Banker, all of the Lake Shore, were participating in an internal fight in the Wabash board. He also had Wall Street in a dither at times over his juggling of Lake Shore finances p287 and securities, to rebuild the Port Clinton short-cut from Sandusky to Toledo (completed 1872), to pay for double-tracking and for other expenses and losses. The great Chicago fire of 1871 destroyed the almost new Van Buren Street Station, owned jointly with the Rock Island, as well as the Grand Pacific Hotel, in which the L. S. & M. S. had $125,000 invested, making the company's total loss $330,000. A year before the typhoon of '73, there were signs that all was not right in the business world. In November, 1872, Rock Island was the only rail stock above par; Lake Shore — despite Clark's optimistic reports to the stockholders — stood around 88‑89, and even New York Central was down to 93.
Commodore Vanderbilt stood coldly aloof from his son-in‑law's activities and devoted his attention to improving the New York Central and Harlaem. He suffered a shock on February 6, 1871, when a tragic accident occurred near New Hamburg on the Hudson River shore. The Pacific Express, the favorite thirty‑six-hour train to Chicago, was approaching the bridge over Wappinger's Creek about 10 P.M. when the engineer saw a southbound freight on the other track, mostly tank cars of oil, derailing from a broken axle and piling itself across both tracks. The engineer stuck to his throttle, trying to slow up and ease the crash, and lost his life when his locomotive plunged into the ice-covered creek. The baggage and express cars and one sleeper crashed on top of it in a heap of matchwood and as usual caught fire from their stoves, the oil from smashed tank cars adding to the horror. The light weight of cars of the day is proven by the fact that passengers poured out of the four rear cars, three sleepers and a day coach, and under the direction of trainmen, uncoupled them and pushed them back, one by one, to escape the flames. Nevertheless, twenty-two were killed and many injured.
That there were five Wagner sleepers on that train proves how rapidly the luxury cars were coming into use. Two parlor cars, Catskill and Highlander, had been introduced on the Hudson River division in 1868. They had doors both at the ends and in the middle; each was divided into three private compartments and a large central room seating about twenty in easy chairs. Here for the first time, extra-wide windows were introduced. In 1872, in the Wagner sleeper Olga, on the NYC, electric lighting was given its first trial. Car lighting by candles was only then in process of being superseded by kerosene lamps. The Olga's current p288 was supplied by storage batteries, but the experiment was not a success.3
The Commodore was determined to keep abreast of the times, but there were limits to his credulity. When a young chap named George Westinghouse, from somewhere in the Mohawk country, came to him with a model of a brake to be worked by compressed air, the old man blasted him out of his office for trying to make a veteran railroader believe that he could "stop a train with wind;" he had no time, he said, to waste on damned fools. Naturally, before long, the Commodore had to eat his words and install the air brake.
In 1875, the Harlaem built a funeral car, Woodlawn, to carry burial parties from the city up to the cemetery of that name, •twelve miles from the Grand Central Station. But when in 1873, the private club car was introduced, some New York editors saw snobbery running wild:
A mutual admiration society, consisting of thirty residents of White Plains and Scarsdale, has chartered the "Adirondack," one of Wagner's drawing room cars, in which, by the Pawling train, they are permitted to ride to and from New York daily, without being subjected to the vulgar gaze and obnoxious presence of ordinary people.4
Voluptuousness like this, plus other things, such as the report that the Central had a locomotive, Cephas Manning, some of whose parts were gold-plated, may have aided in goading the Grangers into issuing another two-cent fare bill (which failed to pass) into the New York Legislature in 1873. An editor remarked that it was an old, familiar figure; it had popped out of the cuckoo-clock time and again before the Grangers were ever heard of.
Vanderbilt was intent on improving the Central's service and capacity in every way. Competition was in the making or threatened all around him; not only from the Erie and Pennsylvania, p289 but closer to home. The New York & Oswego Midland was to make a short-cut across his Albany right-angle. Fitchburg and other New England promoters were scheming to throw connections across the state from the Hoosac to Oswego, from which place the Lake Ontario Shore Railroad was already being built westward towards Buffalo. True, none of these enterprises ever amounted to the proverbial row of pins, but the Commodore couldn't be sure of that.
On the commercial side, he had completed a huge grain elevator on the old Hudson River track in lower Manhattan, and he now had to think of greater speed. Probably he read the item in the New York Times on May 20, 1872, which said that there had been little increase in railway speed in recent years; that the Hudson River and the New Haven made almost as fast time "as any in the country do now;" that trains "on our quickest lines" did not run more than •three miles an hour faster than they did in 1852. The writer said that one trouble with the regularity of trains was that the engines sometimes just could not get up speed, "for which neither the engineer nor anyone else can tell the reason. The only thing he can find out is that the boiler will not make steam fast enough."
Despite these remarks, there were some locomotives that could burn up the road; Jim Wood's 103, for example, which once took the Vanderbilts in a special train from Rochester to Palmyra, •26 miles, in 21 minutes. The Commodore is said to have remarked to Wood when they boarded the train, "Let her slide, Jim, we're in a hurry to get to Syracuse." But the old man decided that Jim had taken him too seriously; he ordered Torrance to pull the bell-cord on the engineer as they neared Palmyra. "What's become of all the stations that used to be between here and Rochester?" he asked.
"Why, that wasn't much traveling," laughed Torrance. "Jim runs between Rochester and Syracuse •(eighty-three miles) "in 70 minutes." But that wasn't the old gentleman's idea of facility. More and better equipment and clearer tracks were needed. The light rails in use then were too dangerous for such speed. Locomotives were being improved; the old wood-burners were almost all gone, and the new machines coming in were the largest yet seen. In 1873 the Central's own shops in West Albany turned out what was said to be the largest locomotive ever built; it had a •17 by 21 inch cylinder.
"A few years ago," remarked the Syracuse Journal, "five or six p290 coaches to a train was considered large. Now there is double that number of coaches, with five or six sleeping cars, attached to every train that leaves for the West in the evening." An even bigger story than that can be told. On one occasion the night express came into New York drawn by two of the road's biggest locomotives, and numbering twenty-two sleepers, plus some baggage cars and a day coach or two. The train had to be cut into three sections to get it all into the Grand Central train-shed.
That sort of thing was not practical, and the Commodore pondered the problem of more trackage and equipment. He even toyed with the idea of a short cut past Albany which was realized more than fifty years later in the Castleton Cutoff, including the A. H. Smith Memorial Bridge over the Hudson, •ten miles below Albany. Vanderbilt's plan was to use the old White Elephant Railroad from Schenectady to Athens, further down the river, bridge the stream there and connect with the Harlaem below Chatham, thus giving two routes into New York. But the heavy grades on the Harlaem and the opposition of the city of Albany caused the plan to be dropped.
In January, 1873, the Central president announced plans for a bond issue, with the avails of which two more tracks would be added between Albany and Buffalo. A new double-track bridge had been built across the river at Albany, which gave four pairs of rails there. The new work was soon begun west of the capital city and carried on right through the smash of '73. Steel rails, the heaviest to be had, costing the fabulous price of $110 per ton, were put into the two tracks destined for passenger service, the old iron rails being used by the freights for the present. In November, 1874, the new tracks were open up the Mohawk Valley between Schenectady and Utica — the first four-track railroad in the world. The quadruple way was halted at Rochester when that city objected to having four tracks run through its heart; two were bad enough. The railroad suggested that two new tracks be built directly over the others as elevated lines, but that only aroused more heated opposition, so the plan was dropped for the moment. Later, when the two tracks were added, the whole line was elevated through the city.
While this work was in progress, the Commodore had another and greater worry on his mind. Horace Clark died on July 1, 1873; but eighteen days before, when he was already ill, he was retired as president of the Lake Shore & Michigan Southern, and his 79‑year‑old father-in‑law was elected in his stead. The Commodore p291 had become convinced of the seriousness of the situation there and had resolved to take over. He had long disapproved of his son-in‑law, and in his report to the stockholders on December 31, 1874, he did not spare the latter's memory. In laying bare the Lake Shore situation, the old man did not use a scalpel, but rather what reporters and coroners call a blunt instrument:
When I was elected your President on July 1, 1873, I found the financial condition of this Company to be as follows. Capital Stock, fifty millions of dollars, all issued; Funded Debt, $29,730,000; Floating Debt, $6,277,485, including a dividend due August 1, $2,004,315, and bills and pay-rolls for June, $1,478,686.
There was not a dollar in the treasury.
Contracts for construction, equipment, 20,000 tons of steel rails, etc., to the amount of $7,894,845 had been made and the work all commenced, with no provision whatever for meeting the large payments.
The panic of 1873 occurred in September, and disclosed the fact that the entire dividend just paid ($2,004,315) had been borrowed on call of the Union Trust Company. That institution closed, and passed into the hands of a receiver, who called the large loan at a time when money could not be borrowed on the best collateral security.
He then sketched briefly his emergency measures. No dividends were paid in 1874. A $1,500,000 contract for a second track west of Elkhart, he succeeded in having cancelled; but for some others so much material had been bought that he had to go through with them. After some pleading, he induced Amasa Stone, Jr., who had retired from executive positions, to come back as general manager and carry out his program of economy. To meet Lake Shore debts that were immediately pressing, he lent the treasurer 7,000 shares of his Lake Shore stock and 1,000 shares of Harlaem to use as collateral in borrowing money. The Lake Shore owed the Union Trust Company $1,750,000, and Vanderbilt was bitterly criticized for not saving the bank from receivership; but he paid no attention to the clamor.
He had little more patience with the course of Gus Schell, its acting president than he had with Clark's. He was strongly opposed to skyrocket speculation of the Clark type, and when the brokerage firm of Burton & Allen — his nephew and grandson respectively — failed in the spring of '73, he didn't lift a finger to help them. They had sided with Clark when Vanderbilt remonstrated with him for carrying too much stock on borrowed funds, p292 and the Commodore thought they needed a wholesome lesson. In behalf of Lake Shore, he wrung every dollar he could get out of the estates of Clark and Lockwood, though that of the former well-nigh vanished in the depreciation of the value of the stock he owned. When asked for his opinion as to the causes of the panic, the railroad king expounded his conservative philosophy:
". . . People undertake to do about four times as much business as they can legitimately undertake. Of course they soon get short and have to bolster up their business as well as they can by robbing Peter to pay Paul. If people will carry on business in this madcap manner, they must run amuck.
"There are a great many worthless railroads started in this country, without any means to carry them through. Respectable banking houses in New York, so called, make themselves agents for the sale of the bonds of these railroads and give a kind of moral guarantee of their secureness. The bonds soon reach Europe, and the markets of the commercial centers, from the character of the endorsers, are soon flooded with them. The roads get into difficulties, and bad language is heard all around.
"These worthless roads prejudice the commercial credit of our country abroad. Building railroads from nowhere to nowhere at public expense is not a legitimate undertaking. . . . When railroads are to be built, don't victimize the public to build them.
"When I have some money I buy railroad stock or something p293 else, but I don't buy on credit. . . . People who live too much on credit generally get brought up with a round turn in the long run. . . . Mistrust will be engendered until we, as a nation, do our business on a more solid basis and pay as we go."
He had set to work manfully to put the Lake Shore — and only incidentally, the Union Trust Company — back on their feet. Within a few days he handed over much larger blocks of Lake Shore, Harlaem, New York Central and Western Union stock to the treasurer of the railroad as a loan, and with these as collateral, the official was able to borrow so substantially as to keep the company out of receivership. The Commodore also gave further aid by buying generously of Lake Shore bonds. In October, only a month after the smashup, the LS gave the Union Trust Company short-term notes for its debt, secured by ample quantities of Vanderbilt's various stocks. The Street now changed its tune, and high praise was heard of Mr. Vanderbilt for risking his own property to save both railroad and bank, and for the skill with which he was accomplishing the rehabilitation of the former. The Union Trust Company was back in business again in three months. As for the railroad, its earnings were carefully applied on debts, extravagance was eliminated, and yet out of income, good, new steel was bought to replace much of the old iron track. By 1876 the directors could report that the floating debt had been paid off and Mr. Vanderbilt's stock all returned to him. The L. S. & M. S. had at last become a typical Vanderbilt railroad.
A pass signed by the Commodore himself
It was in the summer of 1874 that the Commodore was prodded into a speed exhibition by James Gordon Bennett, the younger, an even greater showman than his father, now operating the Herald. At Bennett's desire, a fast special train was sent up to Saratoga — then America's leading watering place — on Sunday mornings that summer to carry the Sunday edition of the Herald. That spurred both publisher and railroad magnate to try a greater stunt; a Sunday morning fast train all the way across the state — yes, by gum, even to Chicago! All was arranged, and patriotically enough, the train's first run was on Sunday, July 4, 1875, and Mr. and Mrs. Bennett were passengers aboard the first three-car train, of which two cars were loaded mostly with papers. Leaving New York at 2:30 A.M., it halted 15 minutes at Albany for breakfast (there were still no diners on the Central), reached Syracuse at 9:30, Buffalo at 1 P.M. and Chicago by 8 o'clock Monday morning. Jim Wood with the 110, a new engine p294 with •61‑inch drivers, just built at the Syracuse shops and said to be one of the fastest machines ever constructed, took the train all the way from Albany to Buffalo, •some 300 miles, an unprecedented thing and seldom attempted for decades afterward, for a locomotive seldom dared run more than •a hundred miles then without dropping out for servicing.
For nine Sundays in a row that train sped across the country, Bennett paying the Central $1,000 for every trip. The countryside stared open-mouthed as it shot past; a news writer said that the suction of air caused by it was like a tornado, and that people walking on the track when it approached them leaped fences or threw themselves into ditches to escape its "deadly embrace."
After nine Sundays, Bennett decided he had spent enough on such advertising. But William Vanderbilt had tasted blood, and before the Bennett special ceased to operate, he had put on a Fast Mail which would, it was predicted, make the run to Chicago in twenty-six hours, maybe twenty-four! (The best passenger train time between the two cities was then about thirty-six hours.)5 The Commodore was opposed to the costly adventure, but he was past eighty now, he had ceased to bully William as he once did, and the boy had his own way about that train. In mail service, as in all other things, the Central and the Pennsylvania were rivals. There was no profit for the major railroads in mail-carrying.6 They did it just for prestige and to outdo the p295 other fellow. The Post Office Department, well aware of this rivalry, traded upon it and egged the Central and Pennsylvania on to attempt faster and better service between New York and the West. The result was an exhibition train on each road, that on the NYC being officially known as "The New York Central and Lake Shore Railroad Post-Office," though its popular name was the Fast Mail. It was to be all-mail, but on the first westbound run, in addition to the four mail cars, the Vanderbilt private car, Duchess, was attached, to carry railroad and postal officials and distinguished guests, and two more sleepers were added at Cleveland. The eleven mail cars built especially for the service were all painted white, with gold striping and lettering, and were all named in honor of present and past governors of the states they traversed. The four honored on the first run were Dix, Morgan, Tod and Tilden. The Post Office Department also went slightly zany, and dyed the bags used on the train a bright red. One car, which reached the unusual length of •sixty feet, was given over entirely to newspapers.
The Saxon was a Lake Shore & Michigan Southern speed king in the 1880's
The first train left New York at 4:15 A.M., September 14, 1875, and despite the fact that it made fourteen stops en route, including p296 a quarter-hour each at Albany, Syracuse and Cleveland for meals, it reached Chicago in twenty-seven hours, though the story is told that on the last lap the strain was so great that the engineer fainted in his cab after halting in the La Salle Street Station. One result of the new train was that upstate New Yorkers received the metropolitan morning papers fairly early on the day they were printed. The train did not continue long, because of the inevitable squabble with the government over payment for the service; but for years after it disappeared, those white postal cars were seen on other mail trains on the line.
The all-white Fast Mail Train of 1875.
The Vanderbilts had some other human weaknesses, too; they were not proof against that curse of the business, the rate war. Another of them broke out in 1875, and for a time the lucky wayfarer could ride from New York to Chicago for eighteen dollars, and oddly enough, could return to New York after his visit for fifteen dollars. In the following year there was a still deeper slash, New York-Chicago tickets dropping to thirteen dollars. That was the year of the Centennial Exposition at Philadelphia, and traffic was heavy, but the railroads were fighting so hard to take the business away from each other that they profited little by the big show. The Exposition was followed by a business dullness, which continued into the following year. But as if that were not enough, the railroads were knifing each other again in the early winter of 1876‑77.
It was in 1875‑76 that the Commodore made his final gesture towards building an elevated line from the Grand Central Station down to City Hall; but the Legislature imposed terms which he wouldn't accept, so he dropped the plan, and told a Tribune reporter (June 24, 1876) that he would have nothing more to do with rapid transit for lower Manhattan. It had been his intention, he said, "to invest as much as $5,000,000 in the enterprise, and make a present of it to the city. Of course," he continued, "it would not do then for me to say anything of this kind, as they would only have said humbug, and as they refused to have the road the way I wished, they will now have to get it the best way they can." But his effort had spurred others to act, and the elevated line became a reality three years later.
That was very nearly his last public appearance. He fell ill that autumn, and by Christmas week he had sunk so low that he was spared the knowledge of what would have been a great sorrow to him — the news of one of the two greatest American railroad disasters of the nineteenth century. For decades afterward, the p297 beautiful name of Ashtabula meant no more to most Americans than a memory of a dreadful holocaust.
In a Cleveland, Painesville & Ashtabula directors' report of the latter 1850's, it is remarked that wooden bridges along the line had been replaced by iron or stone with the exception of those over Conneaut and Ashtabula Creeks, and these were good for several years more of service. In 1863, it was decided to replace the one spanning the Ashtabula gorge, •about a thousand feet east of the station in that town, with one of iron. Amasa Stone, Jr., then in the midst of his eleven-year incumbency as president of the road, thought he knew all that there was to be known about bridges. He was a brother-in‑law and early partner of William Howe, inventor of the Howe Truss, which had been used in the building of hundreds of wooden bridges. He had thrown such bridges across New England rivers with such speed and efficiency as to win high encomiums; he had been railroad contractor, superintendent and executive; who should know as well as he what was what?
When the Ashtabula bridge was authorized, he drew the plan for the •150‑foot span as a Howe Truss. An engineer on his staff who had kept abreast of the times remonstrated with him, saying that the Howe Truss was practicable for a shorter timber structure, but it should never be attempted in iron; in that length, its own weight made it dangerous. Stone, whom success had made arrogant, purpled with rage. Tell him, the president of the company and a veteran bridge builder, that he didn't know his business, he? In furious terms he ordered the man out of his office and struck him from the payroll.
For thirteen years, Mr. Stone seemed to have triumphed in the argument. Then, at 7:28 on the evening of December 29, 1876, the Pacific Express, with four baggage and express cars and six coaches and sleepers, drawn by the locomotives Socrates, Daniel McGuire, engineer, and Columbia, with "Pap" Folsom at the throttle, was pounding westward at reduced speed through what McGuire described as the worst winter storm he had ever experienced in his eighteen years on the road — a howling gale off Lake Erie, driving a cutting, blinding snow before it. A short distance east of Ashtabula they had passed a heavy freight train, a double-header, which had just crossed the bridge.
In one of the sleepers a young woman, one of the few who escaped, recalled that the other passengers, imbued with the holiday spirit, were chatting and laughing, some of them singing. p298 Suddenly she noticed the bell-cord, which hung above the aisle, tighten, strain and break, one end lashing back with such force that it struck a chandelier and knocked one of the oil lamps out of its socket to the floor. A moment later the bottom seemed to drop out of the world.
In the forward locomotive, Dan McGuire said that he was scarcely two car-lengths from the farther end of the bridge when he felt it beginning to sink under him. Instinctively he opened the throttle wider, the engine leaped forward, passed over the abutment and was saved. But the coupling parted behind it, and looking back, McGuire saw train and bridge going down, the Columbia turning bottom upward as it fell into the gorge. Halting, he blew several alarm blasts of his whistle, and then scrambled down the rough, snowy slope, to find Engineer Folsom still alive, but painfully injured. "Another Angola horror, Dan," he muttered as his friend reached him. But it was worse than Angola. The whole train had piled into the •seventy-foot ravine and promptly caught fire. The Ashtabula volunteer firemen, warned by the engine whistle, came and made clumsy efforts to do something, but the difficulty of getting apparatus down into the gulch, and — well, there were bitter charges and counter-charges made later, but they meant nothing to the folk who had died there. It is doubtful that the firemen could have conquered the flames, anyhow.
Of the 159 persons — passengers and crew — aboard the train, only eight escaped injury. Those still on foot, together with the townsmen who came, labored valiantly, but had to see human beings, still alive but caught in the splintered mass, burned to death. One young woman, with feet inextricably pinned under a timber, begged to have them cut off, rather than be roasted alive. But there were no axes to do the job, and so she perished horribly.
Perhaps the most famous passenger on the train was Philip P. Bliss, singing evangelist and hymn writer, who composed words and music for some of the best-loved Gospel hymns of the latter nineteenth century. Hold the Fort, Hallelujah, 'tis Done, Pull for the Shore, Let the Lower Lights Be Burning, Almost Persuaded, What Will the Harvest Be? and Whosoever Will were some of them. He himself was little injured in the crash, but his wife was hopelessly imprisoned in the wreckage. Frenziedly he strained and tore at it with his bare hands as the flames approached, but p299 in vain. He could not get her out, so he stayed and died with her — a Christian gentleman and hero, if ever there was one.
The directors' report shows that eighty-three persons were killed on the spot and nine died later. Nineteen bodies were either unidentifiable or unclaimed, and for these the railroad company bought four lots in the Ashtabula cemetery, where they were buried with interdenominational ceremonies, and where their graves are still cared for by the New York Central Railroad.a
The Ashtabula Disaster; the engine Columbia, which fell with the train; left, "Pap" Folsom, its engineer; right, P. P. Bliss, noted hymn writer; other pictures, the bridge before and after the accident.
The road was cut in two for twelve days. In bitter winter weather, the bridge was replaced by January 10, but the disaster and public criticism so preyed upon the sensitive mind of the Lake Shore's engineer, Charles Collins, that he locked himself in his home and died by a pistol shot a week later. An Ashtabula historian, though uttering some criticism, praised the railroad company "for the straightforward and honorable course it adopted. . . . It showed no disposition to cover up the facts in regard to the unhappy calamity, but evinced a desire to secure a full and impartial investigation before the coroner's jury." For his part, the coroner blamed Amasa Stone for building the bridge on his pet plan, "without the approval of any competent engineer and against the protest of the man who moment drawings . . . assuming the sole and entire responsibility himself." A bridge like this, said the coroner, was "an experiment which should never have been tried or trusted, to span so broad and deep a chasm." But it was his opinion that a careful inspection by a competent engineer during the life of the bridge could not have failed to expose it for the menace it was, and "For the neglect of such inspection, the railroad company alone is responsible." And now for the first time was heard a vague demand from the coroner's jury for some sort of car-heating apparatus "which will be immediately extinguished whenever the cars are thrown from the track."
The disaster broke the proud spirit of Amasa Stone. Conscious that he had lost public respect, that he was a marked man in Cleveland and even regarded by many as a murderer, he endured agony for five and a half years. At last, sleepless nights, followed by failing health, wore him down to the point of following Collins by suicide in May, 1883.
Commodore Vanderbilt was probably too ill to be told of the disaster to the road he had labored so hard to rehabilitate. All that year his health had been precarious, and his occasional illnesses had sent stocks, especially Lake Shore, downward, to his p300 enormous indignation. Only five days after the Ashtabula accident, in the forenoon of January 4, 1877, the spirit of the most noted of American railway executives — in some respects the greatest — forsook the mighty body which it had driven at top speed for almost eighty-three years. Outside his mansion windows, among the gaunt, bare trees of Washington Square, a snow was falling which spelled trouble for the whole New York Central system. A great cortege followed his body by boat down the harbor and along miles of snowy roads to the little Moravian hillside cemetery on Staten Island where Vanderbilts are still buried.
Lake Shore stock slumped because of his death and the disaster, but New York Central stood firm as Gibraltar. It had paid its 8 percent dividends regularly all through the hard times — while some others were paying 6, 4 or nothing at all — but to the veteran secretary of the company, Edwin D. Worcester, the Commodore said in his last days, "I hope our people will be big enough to take care of the Central Road when I am gone. The trouble will be that they will try to keep up the dividends too long. They should take care to come down in dividends as soon as there is occasion." His fortune, estimated at $70,000,000 to $75,000,000, was perhaps the largest that America had yet known, and he left all but $3,700,000 of it to William and William's four sons. Of the latter, William K., George and Frederick each received 20,000 shares of N. Y. C. & H. R. stock, while Cornelius, the eldest, whom the Commodore regarded very highly, received more than twice as much. To his eight daughters and the erratic, epileptic son, Cornelius Jeremiah, the old man left smaller bequests which were unsatisfactory to all of them, and which soon had William H. pestered with lawsuits. He calmed the sisters by giving each an additional half-million, and he took care of Cornelius J., though not to the latter's satisfaction.
The Commodore knew what he was doing. It was his aim to preserve the New York Central system intact, and in the hands of the man he considered best qualified to handle it. "If I had given $3,000,000 to one daughter and $5,000,000 to another," he remarked to a friend during his illness, "the first thing that would be done would be to put Billy out of their own and put Torrance in; then they would get to quarrelling among themselves and throw the stock into the market, and next thing, it would be down to 40."
Flags all over the city were flown at half-mast, and high praise for him came from all quarters. One tribute was that "The rights p301 and the welfare of the smallest stockholder were as well guarded as his own. In a period of crafty devices for sinister ends, he taught the way of success through legitimate means." New York's two other wealthiest men, Alexander T. Stewart and William B. Astor, both had died within a few months, but "The impression made upon the community," remarked the Herald, "by both Stewart and Astor was a faint one compared to the deep mark of Vanderbilt."
That snow which was falling as they buried the Commodore ushered in the worst year that the Eastern railroads had yet known, as the Railroad Gazette asserted later. All through January, one snowstorm followed upon the heels of another. Up in Syracuse on the 8th there was a strange incident, unexplainable unless it was one of those periodic bubbles of resentment over the railroad's occupying the main street of the town. It was thus reported in the New York World:
The City Superintendent of Streets ordered his men to shovel snow to‑day on Railroad Street, upon the tracks of the New York Central. They did so and pounded it down so that two engines were thrown off the track by the obstruction, and travel was suspended five hours. An express train, carrying the United States mail was delayed four hours. Five engines were finally hitched together and cleared the tracks of the obstruction.
NYC trains for decades traversed the main street of Syracuse.
Snow continued falling, and by the nineteenth the road was blocked almost all the way from Buffalo to Albany. They had gotten it only partly cleared when on the twenty-fourth the worst snowfall of all covered it again. The Syracuse Standard, January 28, gave a picture of the situation then; three tracks were open, but on the fourth, west of Rome, they had stored a lot of freight cars that could not be moved — an unbroken line from Oneida to Canastota, then a gap of •about a mile, "and then begins another line of cars which extends nearly to Manlius, none of which has been moved in more than a fortnight . . . it is not likely that any of us will live to see again an almost unbroken string of freight cars on a New York Central track . . . not far from •twenty miles in length."
"Septuple-header" with snow-plow, between Rochester and Syracuse during snow blockade of 1877.
Picture from New York Public Library
To add to railroad woes, there was a real business recession for fully half that year. Many men were laid off, and on nearly all roads, salaries were reduced, which had an unusually bitter taste in the men's mouths. Railroading had become a more strenuous p302 occupation. Hours were long, speed and nerve tension greater, and some bosses drove their men hard. The rough winter just past, when the men had worked their hearts out to keep the trains moving, left them in no humor to accept layoffs and wage reductions uncomplainingly. Unions were growing stronger, too; the engineers' brotherhood had recently staged a strike on the Central of New Jersey which had alarmed all executives. The firemen's brotherhood, organized in 1873, was not as far advanced, but was on the way. Discontent welded all together that year.
In the face of hard times and unrest in their own households, the rail magnates were still beset by that boyish, do-and‑dare complex. Billy Vanderbilt and Tommy Scott began by scuffling with each other over the time of a New York-St. Louis sleeper, then began moving afternoon trains out of Chicago ahead so as to beat the other fellow into New York. Finally, the Central planned a new fast train out of Chicago on June 10, and handbills were strewn over the city, inviting everyone to come to the La Salle Street Station "to see this railway racer receive the word, 'Go!' and to behold the fastest time on record" — which it was hoped, would be twenty-five hours and twenty minutes.
In other words, said Charles A. Dana of the New York Sun, stockholders were "invited by blue and red handbills to look on a waste of their property in a senseless competition that demands an intervention of law to restrain corporate madness and guard the travelling public for multiplied dangers." In parody of the comment on the charge of the Light Brigade, he add, "It is magnificent, but it is not railroading." Competition and poor bodies, he continued, were likely to ruin the railroads. The Erie Canal had reduced the charge for carrying corn from Buffalo to New York to four cents a bushel. Lake boats brought it from Chicago to Buffalo for two cents! Adding elevator charges at Buffalo and insurance, the total cost of conveying a bushel of corn from Chicago to New York by water was about seven and one-half cents. The year before, the canal rate alone on corn had been nine cents. "There is ruin all around in these figures."
As the Railroad Gazette remarked, "You can now leave Chicago at 4.40 one afternoon and reach New York in time to go to the theater the next night — and do it for fifteen dollars." But the nonsense of the whole affair is seen in another quotation from the Gazette, "The companies are not at all anxious to keep up the train. Hardly was the Lake Shore train put on before it began to settle the trouble and return to the old speed. . . ."
p303 Wage cuts had been made on most roads in May, and these racing trains may have been the spark which set off the trouble that followed. The Central had cut most of its men 10 percent, though some higher salaries had been slashed as much as 15. On July 14, B. & O. employees decided to strike, and two days later they began deserting their trains, soon followed by those upon the Pennsylvania and Erie. Ugly tempers quickly flared up and there was rioting at Martinsburg and Baltimore, with one death at each place. Disorder in lesser degree occurred at several other places, but the real storm center was Pittsburgh. There fighting, pillage, arson and bloodshed, with many deaths, reigned for nearly a week. Roundhouses, shops, miles of freight and passenger cars, and even the Union Station, were burned. The loss was placed at $4,000,000.
The war began in Pittsburgh on July 21, and on the following day the Lake Shore men decided to go out. Bee Line trainsmen and shopmen in Cleveland reported for duty on the morning of the 23d, but there was such a crowd of the disaffected there to interfere with and threaten them that the management thought it best to declare a holiday. Lake Shore men at Cleveland met that day and drew up an amazing document:
Resolved; That we, as a body of railroad men, will abstain from all intoxicating liquors during the trouble.
All property belonging to the railroad company at this point shall be respected and protected to the utmost of our ability.
Try that on today's piano. The good will of the strikers did not, however, extend to the cattle, hogs and chickens which died by thousands from starvation, thirst and suffocation on stalled trains at Cleveland. Soap factories carted away the hog carcasses and some of the cattle, to render the fat from them. There was greater loyalty on the New York Central. Shopmen at West Albany and Syracuse went out, and some others at Buffalo, where they were influenced by the Lake Shore and Erie strikers. There was little or no disorder anywhere on the Central. Freight movement was halted for about three days, but passenger service was affected hardly at all. The Lake Shore strike gradually faded on the 28th and 29th, with no concessions by management, which was true practically everywhere. President Vanderbilt ordered a bonus of $100,000 to be distributed among the NYC employees who did not leave their posts. On October 3, half of the wage p304 cut was restored, and in February, 1880, full salaries were back in force. After that, they began rising.
Even through the great depression of 1873‑76 and the backset of '77, the New York Central had continued to pay its 8 percent dividend, though at one time, by a very small margin, it had failed to earn it. Now, the report for the year ending September 30, 1877, showed that the gross earnings of the company, which had coasted downward from '73 to late '76, had, amazingly enough, in that ugly year of '77 taken a turn upward. But it was entirely in the freight traffic; passenger business was still lagging. Edward Hungerford says in his Men and Iron that in '77 "it paid 10½ percent of the aggregate dividends of all the railroads in the entire United States."
The fact is that, following the chariot race of June, and the strike in July of that year, the New York-Chicago railroads had formed a pool, by which the returns from competitive business were proportionately divided. Mr. Vanderbilt defended this arrangement in a letter to the Chicago Times (June 25, 1878), in which he intimated that this was the only way in which the railroads could keep from fighting:
. . . The great commercial, financial, agricultural and industrial interests of the country are all injured by such competition as has heretofore prevailed, with its attendant uncertainties, fluctuations and bankruptcies, and . . . they would all benefit by such a check as would secure fair profits. . . . What the people want is certainty and moderate prices for freight. The object of all pooling arrangements is to bring about this result. . . . If any other scheme will work better, then I am in favor of that. High rates in the future are utterly impossible. The people are safe from extortionate charges.7 Stability of prices, fair rates for transportation, equitable dealings with shippers and general prosperity can be had only through some understanding embraced in what is generally styled a pool.
Meanwhile, the new president was improving the service of the Central and allied roads in many ways. For the NYC he created new departments to take over some of the duties which, along with other work, had been piled upon the shoulders of men already too heavily burdened. The four principal new officials thus brought into being were the general traffic manager, general passenger agent, general auditor and general counsel. p306 For the last-named post, what other name was there to consider but that of the genial diplomat, Chauncey M. Depew? Each of these men appointed sub-chiefs, and the whole became a much more efficient machine. Other big jobs were going forward on the dominant road and subsidiaries; the grade elevation at Rochester, eliminating twenty street crossings, and the building of new stations there and at Buffalo, after the train-shed at the latter place had collapsed under a blanket of snow in February, 1881, killing four people. Dining cars were put into service on the Central in '83. Mr. Vanderbilt's labors in improving the Canada Southern-Michigan Central route to Chicago have already been chronicled.
After the death of the Commodore, a Central director was asked, "Who would take Mr. William Vanderbilt's place if he should die suddenly?" to which the prompt reply was, "Probably his son Cornelius, secretary of the Harlaem. He is about 27" (he was really 34) "and just like the Commodore — quiet, shrewd and sensible; habits splendid and a regular worker." The director added that the second son, William K., then 27 and working at the Grand Central Station, was another "chip of the old block." For a time their father seemed to put the second son forward at the expense of the first. William K. became second vice-president of the New York Central, and in 1882, when his father reorganized the Canada Southern, William was elected its president and his brother Cornelius, vice-president. In January, 1883, William K. became president of the newly-acquired Nickel Plate road. But all the time the hard-working, uncomplaining Cornelius was being groomed for the headship of the New York Central & Hudson River.
Lake Shore & Michigan Southern Railroad in 1890
1 Torrance used to ride over the Central in one of the earliest private business cars seen in America. Painted the darkest of browns, it had its name, Shoo Fly (after a popular post-Civil War Negro dialect song) in a scroll on the side, the "Shoo" in gilt lettering, following by a crude picture of a fly in red.
2 "Miss Tarbell's History of Standard Oil," McClure's, December, 1904.
3 It was in the early 1880's that Pintsch (acetylene) gas began to replace oil lighting. Electric lighting came in the following decade.
4 Amidst all these up‑to-the‑minute improvements and elegancies, some old customs still prevailed, as indicated by the notice which the Harlaem station-master at Mott Haven posted outside his ticket window in 1873:
I will not give out a ticket on trust, please don't ask me, for my answer will be, "No, Sir."
5 The NYC & HR director's report for 1876 shows that such trains as the Fast Mail were more than rare. It gives the "average speed of ordinary passenger trains" as •25 miles per hour, including stops; express trains, including stops, •30 mph; when in motion, 35 mph. Freight trains, including stops, jogged along at •12 miles, when in motion, •25 miles.
6 The Railroad Gazette wrote scathingly on January 31, 1874, of the Government's niggardliness with regard to mail service. "A certain compensation having been granted to the railroad companies for carrying mails, they were afterwards required in addition to carry post-offices." Not only that, but they must build and equip these postal cars, light, heat and repair them, and when they asked for additional pay for this much greater service, "they have been put off year after year and never got any satisfaction. Finally, having done the work for years for less than cost . . . when they announced that they must decline to do the work longer at a loss, they were abused as if they were rebels, and threatened with seizure and all sorts of penalties;" and these threats came from officials who well knew the injustice that was being done, but "who also knew that the public and the newspapers generally would not study the question," and that in a dispute with the railroads, the Government "would have the sympathy of the uninformed public, and that is probably ninety-nine hundredths of the people of the United States." It is a matter of record that express companies paid from fifty to seventy-one cents per mile for their privilege on roads which operated postal cars, for which the road received only twenty cents per mile — and until 1873 some of them got as low as seven cents.
7 The water carriers were doing much to take care of that.
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