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Railroads
were the field were many of the greatest Gilded Age fortunes were
built. With the opening of the West, railroad construction reached
record proportions just after Civil War and during the 1870's and
1880's. Railroad mileage rose from 35'000 miles in 1865 to over
163'000 in 1890, almost a fivefold increase. Railroads became the
knit which held together the growing nation, creating by their very
existence opportunities for entrepreneurs in other fields.
In
1865, railroads had been around for a generation and the Eastern
trunk lines, which would soon make the fortune of the first great
railroad tycoons, were already in existence. Started with municipal
and state aid by local merchants, the Baltimore & Ohio Railroad had
crossed the Appalachians and become a profitable business, already
firmly in the hands of Johns Hopkins and
John Work Garrett. Hopkins
was a self-made liquor merchant and Garrett the son of an
established merchant banker. Both men became multi-millionaires from
their investment into the B&O. Further North, the Pennsylvania
Railroad was started in a similar way and also had found its
leaders, in the persons of
John Edgar Thomson and his able
vice-president Thomas Alexander Scott.
In
1853, a loose group of scattered railroads were merged to form the
New York Central, the first significant railroad consolidation in
America. The promoters of this scheme, men like Erastus Corning and
Dean Richmond, became wealthy capitalists, although not major
tycoons. Their railroad would become the nucleus of a system
belonging to the richest
railroad tycoon ever, a man who hade already made a fortune in the
steamship business.
After
the outbreak of Civil War,
Cornelius Vanderbilt left the steamship
business, sold most of his ships to the Union Navy and started his
career of a railroad tycoon. In a number of short campaigns, he
acquired the New York & Haarlem, the Hudson River and the New York
Central railroads and consolidated them into a through system,
running from New York to Buffalo. He later acquired the Lake Shore &
Michigan Southern and completed his system through to Chicago. In
the process he built himself a fortune of 105'000'000 $ and became
the richest man in the world.
Through
their Credit Mobilier construction company, the builders of the
Union Pacific Railroad, including
Thomas Clark Durant and the
Ames
brothers of Boston, made a fortune of some $ 16 million. By holding
to their shares for a longer time and monopolizing the traffic in
California, the Pacific Quartet (Stanford,
Hopkins,
Huntington and
Crocker) made many times more from the shorter
Central Pacific
railroad, the first to cross the Sierra Nevada.
Other
railroad tycoons made equally large fortunes in all regions of the
United States, building other transcontinental roads, speculating on
their stocks and bonds to eventually consolidate them in ever larger
systems, spanning whole regions and driving towards a monopoly,
which they never seemed to reach. Men like
Jay Gould, Jim Fisk and
Russell Sage became known as the archetypes of the robber barons,
preying on their fellow citizens to extort their money in devious
Wall Street speculations or corporate coups.
Many
more could be cited here and will be sketched in detail in these
pages : John Insley Blair, who at one time owned more railroad
mileage than any other American; James Jerome Hill who quietly built
the Manitoba into the Great Northern Railroad or Edward Henry
Harriman, who reorganized the reputedly bankrupt Union Pacific in
1895 and from there built the largest railroad system in the West,
thwarting even the great
John Pierpont Morgan.
The Gilded Age
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Introduction and Index
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