ROBBER BARONS

THE FIGHT FOR ERIE

WHILE millions of farmers and workers were bringing forth bumper crops of grain, hordes of cattle and mountainous heaps of iron ore, coal, oil and other minerals which moved in a continuous stream from the earth, through the factories, elevators, and yards of the industrialists to the markets, a momentous struggle developed among certain soldiers of fortune for the rule of the iron highways over which the greater part of this stream of commodities flowed.  Late in 1869, Charles F. Adams, Jr., who was becoming a specialist in railroad affairs, came upon evidence of a “vast conspiracy” which began in an attempted seizure of one of the principal trunk-lines in the East ;  then in wide ramifications enveloped the national currency system, the political leaders of several of the state legislatures, the federal government, members of the presidential cabinet itself.  The machinations of the “conspirators” seemed at the time of historic significance to both the Adams brothers, who believed that successive crises had been precipitated by them, culminating finally in the nation-wide panic of 1873.  Sensing the new powers at work in the situation, the deep alterations in American society, they had tried to expose the principals of the plot ;  they wrote “Chapters of Erie,” unfolding the whole sensational story in a form still substantially correct.  They were beating drums, setting up signal-fires ;  yet no one had been alarmed, or had the time to be alarmed.

The contests which were waged unremittingly, and by no means bloodlessly, for more than five years, involved rule of the lines between New York and Chicago, the most fruitful traffic in the country, which would have enabled those who controlled it to extend their empire over the weaker systems which ran farther west even to the Pacific.  In these memorable contests, which we record in some detail, the principal villains and heroes were Drew, Gould and Fisk of the Erie faction, and Commodore Vanderbilt, and later, J. Pierpont Morgan, for the New York Central party.  There were various minor characters as well, “soldiers and villagers,” statesmen and justices, and there was the public which looked on now with enjoyment, or now in angry bewilderment.

By 1866 Commodore Vanderbilt in pursuance of his plans of consolidation had bought enough stock in the Erie Railroad to announce confidently that he intended to add this line to his growing system.

The group of railroads thrown together as the Vanderbilt system complemented each other nicely :  the Harlem gave a terminus and franchise in New York ;  the Hudson River Railroad continued from its juncture with the Harlem tracks up the east shore of the river to Albany ;  and thence the New York Central ran up the Mohawk Valley to Buffalo, and connected with the Lake Shore (in which the Commodore had also invested) as far as Toledo.  His eye was fixed upon the Michigan Southern and its Chicago terminal, when he perceived that the Erie Railroad was moving in the same direction.  In apprehension, he made overtures of friendship to Uncle Daniel Drew, purchased about 20,000 shares of Erie stock and had himself elected a director of the road.  He now owned a prominent share of its capital, had the secret collaboration of Drew as he believed, and might subdue the Erie’s opposition to his triumphant westward march.

But soon sufficient signs appeared that all was not well.  There was no trusting the deep Uncle Daniel ;  for shares of Erie stock were pressed steadily upon a declining market, as if flowing from a concealed underground stream, while Vanderbilt continued buying.  In 1866 Drew had loaned his railroad, of which he was treasurer and chief stockholder, $3,480,000 on the security of 28,000 unissued shares of its stock, and $3,000,000 of its convertible bonds.  Now Drew bought and sold Erie stock in Wall Street, using the collateral he possessed—whether lawfully or unlawfully it is not known—to cover his operations.  This was one source of supply ;  but there were more.

In the same year, at the proposal of Jay Gould, who roamed about trading in little railroads, Drew together with his agents Fisk and Gould had bought a small company, the Buffalo, Bradford & Pittsburgh Railroad, as a private transaction of their own, for $250,000.  Against this sum of assets the new owners had with splendid imagination issued $2,000,000 in bonds.  They then proceeded to lease their road to the expanding Erie system for 499 years, the ransom being assumption of the smaller company’s bonded indebtedness by the larger one.  Thus $2,000,000 of Erie convertible bonds (convertible into shares of capital stock) passed into the hands of the three confederates in exchange for their Buffalo, Bradford & Pittsburgh, which had cost them one-eighth of the sum.  Through the right of bond conversion Drew, Gould and Fisk now had a large reserve supply of Erie stock, which they continued to sell steadily through 1866, as far as they dared, while agents of the great “bull” Vanderbilt purchased them almost as soon as they were offered.

“Buy Erie,” Vanderbilt ordered his brokers.  “Buy it at the lowest figure you can, but buy it !”  His holdings increased visibly, and knowing nothing of the secret acquisitions of the Erie ring he assumed that the market would soon be bare of offerings.  He possessed more shares than were known to exist.  Erie’s stock climbed to 95.  The shorts, he told himself gloatingly, would be soon trapped as in the famous Harlem corner.  But suddenly a wave of crisp, newly printed Erie shares struck Wall Street, 50,000 of them, and smashed the market, so that the price broke to 50 a share, and Vanderbilt in the calamitous process was loser by some millions of dollars to the party headed by Daniel Drew.

The rage and mortification of the Commodore now passed all bounds.  Determined upon defeating his treacherous adversary, and also seizing control of the opposing railroad in order finally to form a combination or pool for fixing traffic and freight rates, he now took elaborate measures to assure himself of ownership.  A group of Boston financiers headed by John S. Eldridge, in charge of the small Boston, Hartford & Erie Railroad, had been building westward—largely under Massachusetts subsidy—and had planned to connect with the Erie to bring Erie coal to Boston.  This railroad too had been overladen with debt by its builders, and was without funds for further construction.  Its directors had previously purchased a sizable block of Erie shares as a means of bringing about a consolidation.  The Boston financiers were a new factor in the control of Erie, and courting Vanderbilt’s favor they now entered into a secret agreement with him to vote their shares at the approaching election of directors so that Drew would be ousted.  In return, Vanderbilt would have the Erie absorb their New England railroad, by advancing them four millions in bonds, thus furnishing them with funds for the construction they so loved to carry on.

Daniel Drew was now given notice that his days at the head of the Erie were numbered ;  moreover an injunction issued at the Commodore’s complaint overhung him, and restrained him from voting his illegally obtained stock.

Hat in hand, and with tears flowing from his old eyes, Drew came to beg his ancient rival for mercy.  Was it by a whim, a moment of sentimental weakness that Vanderbilt forgave the old drover—something that he was rarely known to do ?  More likely Drew had convinced his adversary that in happy accord, they, as two mercenary captains, might win many fruitful victories at the cost of common enemies, the “outsiders.”  Thus a successful pool formed with the purpose of advancing Erie stock might easily erase Vanderbilt’s recent losses, and Vanderbilt had to admit that no one knew better how to manage such forays nimbly than did the Speculative Director of Erie.  Finally, Vanderbilt undoubtedly admired the wily old man and was the last one to be shocked by his ruthless proceedings.

The bargain was struck.  It was agreed that in response to the clamor of the outside public Drew was to be officially ousted, and a “dummy” director put in his place, while he remained in actual charge of their mutual affairs.  This was done at the stockholders’ meeting of October 18, 1867, and the new interests, including the Boston financiers, elected their directors.  The two young, almost unknown, allies of Drew, James Fisk, Jr., and Jay Gould, who appeared to have intruded themselves in the Boston faction, were among the new members of the executive board of a great railroad for the first time in their lives, with the approval of Vanderbilt.  Then, soon afterward, to Wall Street’s surprise, Drew reassumed his former position.  Peace, and subservience to Vanderbilt control, was the order of the day ;  and Erie’s mercurial stock rose rapidly under the bidding of the new pool which Vanderbilt interests backed.

But soon all did not appear well to the Commodore ;  he found mysterious selling of Erie in the market, readily offered shares.  When he called a meeting of the New York Central and Erie directors together to pool traffic and equalize rates, he found to his surprise that Drew, Gould and even his recent allies from Boston had grown disaffected and were ranged against him.  And to his great anxiety, he learned that the Erie Railroad proposed to make large new issues of bonds for purposes of construction and expansion.  Its tracks were six feet apart ;  and it was now planned to spend many millions to lay a third track, inside, at the standard gauge, so that trains from the Michigan railroads could connect with its lines.  And, with unsurpassed boldness, in defiance of Vanderbilt, the Executive Committee of Drew, Fisk and Gould, the “Erie ring,” now secretly authorized the issuance of a mass of new convertible bonds, ten millions more !

Once more the impetuous Vanderbilt saw that he had been outwitted and deceived ;  that he must at once buy an absolute majority of the much augmented supply of Erie’s stock in the open market if he would control the situation.  And with a great oath he ordered his brokers again to “buy every damn share that’s offered.”

But what if the Erie ring simply printed infinite quantities of stock, issued unlawfully against “convertible” bonds which had not even been publicly sold, against which no funds had been paid to the railroad ?  How could he shore up the flood of paper pouring from their printing presses ?  He must have the law upon the conspirators.

Early in 1868, the highly obliging Judge George C. Barnard of the New York State Supreme Court (and of the Tweed ring) enjoined the Erie directors from further issues of securities, and ordered them to return to the treasury one-fourth of the shares recently issued, as well as the $3,000,000 of convertible bonds dated 1866.  Jove-like, Judge Barnard fired injunctions like bolts of lightning, while the cohorts of Vanderbilt took heart, and Erie’s stock rose 30 points to 84.  Vanderbilt and his party had some 200,000 shares accumulated ;  and it looked as if the Erie bears, thanks to the majestic intrusion of the Law, were badly cornered at last.

Out of their midst, however, Jay Gould now emerged as the effective leader, displaying craftiness, promptitude and boldness in action which showed him a worthy foe of the craggy Vanderbilt.  Hurrying to the town of Binghamton, New York, he uncovered a judge of the state’s Supreme Court who heeded fully his own substantial reasoning, and sent forth counter-injunctions.  But better still, before the hour of judge Barnard’s injunctions, Drew, Gould and Fisk, with forethought of what was coming, had taken the whole $10,000,000 of recently issued bonds, and assigning them to a broker unaffected by the court orders, had them converted into 100,000 shares of stock.  Then, always pretending to obey the court’s orders, a messenger boy was ordered to carry the stock-book containing these new and forbidden shares to a place of deposit assigned by the court.  But by prearrangement the burly Fisk, lurking outside the door, intercepted the boy, wrenched the stock-book from his hands, and disappeared !

In the financial markets there spread the most terrible uncertainty as to what was coming, not only for the contestants but for business in general, as a consequence of so much deviltry.  Drew and Fisk suddenly flung a great mass of the disputed Erie shares (whose fate none had known) upon the market, causing a riot in Wall Street, “as though a mine had been exploded.”  Upon the stock exchange trading was suspended in Erie ;  brokers poured out into the street shouting and gesticulating like madmen ;  and above their tumult sounded the mad roars of the Cyclopean Vanderbilt who, it appears, had been cheated once more out of an enormous sum of money reckoned at between five millions and seven millions of dollars.

Again and again the Commodore had grasped hungrily for the Erie Railroad and each time by a deft move his opponents had wrested the prize from his reaching arms.  The more shares he bought with his good money the more they printed, in order to reduce his portion of the ownership.  Jim Fisk had said publicly :  “If this printing press don’t break down, I’ll be damned if I don’t give the old hog all he wants of Erie !”

There was no more time for temporizing.  Calling upon judge Barnard again, Vanderbilt had him order the arrest of Drew, Gould and Fisk for contempt of court.  Then for the unhappy railroad a receiver friendly to Vanderbilt was appointed.

But once more the rulers of Erie had been forewarned of the enemy’s strokes.  At the railroad headquarters on West Street, amid great excitement, they gathered quickly all the funds received from their stock-market transactions, all cash in banks or in the company’s treasury, all securities, documents and incriminating evidence, and made ready to flee.

Notices, warrants and writs were known to be on their way at ten o’clock of the morning of March 11, 1868, when Daniel Drew, Jim Fisk and Jay Gould, after emptying the safes in West Street, and cramming a great bundle of six millions in greenbacks into a valise, threw themselves into a hack and rode at top speed toward the Hudson River.  At the Jersey City ferry, a formidable bodyguard of Erie porters and detectives already waited to escort them on their westward journey into the free and open spaces of New Jersey.  It was, a close call ;  the deputies, hard on their heels, had managed to arrest two directors and clap them into Ludlow Street Jail.  Some others had escaped in rowboats across the river.

Arrived in Jersey City the men of Erie established their main offices in the hotel known as Taylor’s Castle, hard by the Erie depot.  They threw armed guards about the place and renamed it “Fort Taylor.”  To the newspapers which followed the cause célèbre day by day, the breezy and irrepressible Fisk made the following statement :

The Commodore owns New York, the Stock Exchange, the streets, the railroads and most of the steamships there belong to him.  As ambitious young men, we saw there was no chance for us there to expand, and so we came over here to grow up with the country.... Yes, tell Mr. Greeley from us that we’re sorry now that we didn’t take his advice sooner—about going West.

2

To the huge entertainment of the general public, the War of Erie continued to rage all through the year 1868, with mounting effects of the burlesque and the sinister.  Daniel Drew now seemed the much subdued prisoner of Gould and Fisk, who held him bound to them in a manner that showed their complete grip over his darkest affairs.  Intensely aroused by the prize of millions of greenbacks in their grasp, the two young men surpassed themselves in brilliant stratagems directed against the Vanderbilt party.  On the one hand they undertook a famous division of spoils with the local statesmen and judges, which the parsimonious Commodore, though goaded to extremities, felt too poor to attempt on such a scale.  In the next breath, before the press and the people, in raillery or in earnestness, they denounced their famous enemy as one who lusted for monopoly at all costs, “of all the railroads that tie up with the West,” and presented themselves to popular opinion as friends of the masses.  And to lend color to such claims, Jay Gould reduced passenger rates to Buffalo from seven dollars to five, a strong blow at the hard-pressed Vanderbilt.  Finally, having high respect for the Commodore’s prowess, and not trusting the foregoing measures, they also had recourse to arms.  Jersey City’s Chief of Police furnished at their request a squad of police to augment the force of railroad detectives who patrolled the streets and wharves near “Fort Taylor”;  three twelve-pound cannon were mounted on the piers ;  and Jim Fisk, at the head of a squad of four dozen men, equipped with Springfield rifles and lifeboats, strutted about, bursting with pride :  he was now “Admiral” Jim Fisk.

In the financial center of New York, a period of stringency followed the flight of the Erie ring.  The removal of between six and seven millions in currency, at a time when Vanderbilt and the bankers who financed him were reported to be embarrassed, caused a decline in securities, and even a fall in the dollar.  But with iron nerve the Commodore held on, no one knew how.  He had a mass of Erie shares, upon which the banks refused to lend him further sums of money, as a fraudulent security ;  they would accept only his New York Central stocks as collateral.

“Very well, gentlemen,” his broker said, as if by authority, “if you don’t lend the Commodore half a million on Erie at 50, and do it at once, he will put Central on the market tomorrow and break half the houses on the street !  You know whether you will be among them.”

Vanderbilt was ready to bring the whole financial structure down in his ruin.  With pistol pointed at their head, the bankers and the disheartened speculators continued to follow their leader, willy-nilly, in his dark hours.

As exiles in Jersey City, the rulers of Erie—with the exception of Drew who shut himself up in a room and prayed most of the day—had arranged their lives tolerably well among the unfamiliar scenes.  The undersized, almost effeminate Jay Gould showed at this juncture his heroic qualities.  The management of the great railroad system was in his hands and all its departments were brought together in the Jersey City hotel.  Silent, humorless, and under a habitual nervous tension, the little man with piercing black eyes labored tirelessly or calculated all the day upon their involved affairs.  Even Drew, grown senile, could no longer fathom the limitless ambitions of this deep young man, who spoke little, stroked his black beard continually, or nervously tore up pieces of paper into thousands of little bits for hours at a time, at his desk.

Jim Fisk, though he got on famously with his strange confederate, offered a remarkable contrast to him.  Where Gould was abstemious, Fisk was open-handed and spent his money freely ;  where Gould, who kept his mouth shut and his money hidden, was cautious or diffident, Fisk was loud and self-confident.  Yet his braggadocio concealed his real shrewdness, and with his verve, his ready jests, his strewings of charity—like a Robin Hood—he diverted attention from his monumental unscrupulousness.  And though Gould’s life was a torment, showing too plainly the cross of his overweening moneylust, Fisk rejoiced, brangled and drank while engaged with unequaled zest in the multitudinous details of his office.  At the railroad headquarters of Taylor’s Castle, he installed his buxom mistress, Josie Mansfield, whose dazzling white skin, whose thick black hair and gray eyes enthralled him so long and fatally, for whom he had forsaken his lawful spouse, and upon whom he lavished vast sums of money in his mad infatuation.  Though Gould was himself puritanical in his private life, and disapproved of his partner’s lavish style, he would say nothing.  Though his was the directing brain, he knew how much he owed his success at the outset to the brimming energies, the audacity, and the unfailing good spirits of Fisk, whose cunning cynicism he understood better than anyone else.

Cut off from the financial capital, their situation was by no means comfortable, and the aging Drew complained bitterly.  They held Erie, but the enemy held New York.  It was rumored that Vanderbilt had offered a prize of twenty-five thousand dollars for the kidnaping of the trio ;  and one day a band of forty evil-looking New York toughs had crossed the river, and laid siege to the Erie offices.  They retired to the Empire State only upon the appearance of superior forces.

After but a few weeks of enforced exile, Jay Gould suddenly departed for Albany upon a secret mission of tremendous importance.  He bore with him a big valise containing $500,000 in greenbacks.  At the state capitol, as Charles F. Adams explains, “he assiduously cultivated a thorough understanding between himself and the legislature,” an understanding which later figured in the books of Erie as “legal expenses,” eventually costing $1,000,000.

Gould, convinced that he had not heeded the letter of the law sufficiently, lobbied for a measure which would legalize the new issues of Erie convertible bonds for the sake of “construction and improvements.”  On behalf of Vanderbilt a formidable body of legal counselors, headed by the young, silver-tongued Chauncey Depew, descended upon Albany to advocate the condemnation of the Erie ring and all its lawless proceedings.  Faced with such moneyed contestants, the excitement of the tribunes of the people passed all bounds.  Never had such bounties been offered for good-will of state Senators.  Riotous scenes were succeeded by more secret and muffled ones behind closed doors in hotel rooms or in saloons with the agents of both forces.  On the whole, led by the astute Senator William Tweed, the statesmen conducted themselves with remarkable poise, and led the Erie and the New York Central men to bid against each other until the maximum levies were gathered from both.

Gould, arrested by order of the Supreme Court, remained in the custody of a sheriff’s deputy, but continued his elaborate negotiations from his hotel suite.  He admitted afterward having overpaid one man “in whom he did not take much stock” by $5,000.  What did he pay then to those in whom he did take stock ?  Others were said to have received as much as $100,000, while, according to Charles F. Adams’s account, still others received $70,000.  Above all Senator Mattoon, chairman of the committee reporting the Erie Bill, appears to have been marvelously enriched after confidential interviews with both sides, and aroused the bitterest envy among his colleagues.

Fabulous stories were told of the amounts which the contending parties were willing to expend [reports Adams] ;  never before had the market quotations of votes and influence stood so high.

An “investigation” ordered by the Senate thereafter (April 10, 1873) showed that more than a million dollars had been expended by Drew, Gould and their associates in the one year 1868 “for extra and legal services.”  But in the final stage Gould’s extravagant generosity—perhaps owing to inexperience—was justified when the tide of battle swung to him.  It had become known that Vanderbilt, with whom Tweed pretended to side because of an earlier pledge, would pay no more to have the bill defeated.  In a rage the legislature had turned against him and passed the measure substantially as Gould desired it, and Governor Fenton, also believed to have been “assiduously cultivated,” signed the bill.  The indefatigable, unsleeping Gould in his first great political campaign, moving softfooted everywhere, pressing money upon each lawgiver or menacing him through many quarters with defeat in his home district, triumphed at last by bold, hard work.  His actions were made legal ;  his rule of the 800-mile trunk line was unchallenged—save in the city of New York, where a trivial charge of contempt of court overhung him.

In the following year his enemies made a serious effort to have the act of 1868 repealed, but Gould, testifying before the New York Senate Railroad Commission, spoke with impassioned eloquence in his own behalf.  These continual hearings and investigations by the representatives of the people were the great public comedies of the times.  His judges included members such as Mattoon, to whom he had previously justified his great designs behind the closed doors of hotel rooms or saloons by proofs valued as high as $20,000 at a time.  And now before the same judges, turned sanctimonious and impartial, he must appear to justify in the eyes of the world what he had already proved in private.  This shadowplay was part of the period’s moral customs and social traditions, and Gould showed himself equal to his part.  Though his heart might be full of contempt for the vultures who preyed upon his business, he would proceed to justify his ways to God and man, by pleading pathetically or impetuously in his own defense, and by playing upon their fears.

It was he, Jay Gould, who had saved the Erie Railroad :

And as long as that law (of convertible bonds) is unrepealed, I should do what I did again ;  I should save the road. . . . If that was repealed, I think Mr. Vanderbilt would have the road, but as long as it is not repealed it is held in terrorem over him.

Gould invoked, perhaps for the first time—here is immortal cormedy—the specter of the arch-monopolist of railroads devouring the common people.  The only way by which Mr. Vanderbilt’s New York Central could continue to make exorbitant profits upon its watered stock would be through the control of the Erie and the end of its competition :

They would then control clear through to the Pacific shore ;  they could make the price of flour every day in New York or New England a dollar less or five dollars more ;  they could make the price all winter long. . . .

He, Jay Gould, was for “competition,” first, last and always.  Warning, cajoling and appealing, Gould won his case and continued on his triumphant way.

The public, on the whole, seemed tolerably satisfied that the omnipotent Vanderbilt had been dislodged by new elements.  Gould moreover had shown the highest abilities.  He had shown himself equal to Vanderbilt in direct combat ;  he won acclaim through having seized a great railroad system in the teeth of the most ruthless adversary, who possessed the largest fortune in the country.  He had shown himself master of Drew in both cunning and imagination, manipulating the markets with surpassing brilliance and working the printing press with even more reckless abandon.  When the going was roughest, when the plot lay thickest, Gould had seemed only more dispassionate, his voice softer, only his eyes glowing more black.  And from the whole campaign which so enriched him, he also absorbed rich lessons in statesmanship which he was never to forget.

In a statement made under oath before an investigating committee of the New York State Legislature, in 1873, he explained the principles of his successful political tactics, saying :

In a Republican district, I was a Republican ;  in a Democratic district I was a Democrat ;  in a doubtful district I was doubtful ;  but I was always for Erie !

He had learned, moreover, that it was not enough to conquer a whole legislature ;  but one must buy the judges as well.  In this direction his jovial and florid comrade, Fisk, operated with great sagacity after the spring of 1868 ;  he made overtures to Tammany Hall and was soon well regarded there.  As a means to ensure undisturbed rule over Erie’s domain, William Tweed and his colleague, Peter Sweeney, had both been elected to the board of directors of the Erie Railroad.  And though officially pledged to Vanderbilt, their secret influence, it was widely believed, had been thrown to the side of Gould.

Finally it was still necessary to make peace with Vanderbilt, a mighty power who must somehow be mollified.  In the summer of 1868 overtures were made by both sides.  Vanderbilt himself had written to Uncle Daniel a secret message :

Drew :  I’m sick of the whole damned business.  Come and see me.
Van Derbilt.

When the two met at Vanderbilt’s house, the Commodore is believed to have said with his usual forthrightness :  “This Erie war has taught me that it never pays to kick a skunk.”  He proposed terms which were severe, but appealed to the exiles more than perpetual isolation and attack from such powerful quarters.  Drew, Gould and Fisk “were to make restitution, repaying the Commodore $2,500,000 in ready money, another $1,000,000 subsidy in return for an option on fifty thousand shares of his stock, and $1,250,000 in bonds—in all a total of some $4,550,000 which he asserted had been stolen from him by way of the printing press.  Drew accepted the terms meekly ;  and at a further conference early one morning in September, 1868, at which Gould and Fisk appeared in the Washington Place residence, a lasting accord was established, which brought immunity on old charges against them.  It would appear that the Erie men assented to Vanderbilt’s hard terms, somewhat reluctantly according to Fisk’s account :

The Commodore was sitting on the side of the bed with one shoe off and one shoe on.  He got up, and I saw him putting on the other shoe.  I remember that shoe from its peculiarity :  it had four buckles on it.  I had never seen shoes with buckles in that manner before, and I thought if these sort of men always wear that sort of shoe I might want a pair.

He said I must take my position as I found it ;  that there I was, and he would keep his bloodhounds (the lawyers) on our track ;  that he would be damned if he didn’t keep them after us if we didn’t take the stock off his hands.  I told him that if I had my way I’d be damned if I would take a share of it ;  that he brought the punishment on himself and he deserved it.  This mellowed him down. . . . I told him that he was a robber.  He said the suits would never be withdrawn until he was settled with.  I said (after settling with him) that it was an almighty robbery ;  that we had sold ourselves to the devil, and that Gould felt just the same as I did.

Vanderbilt had lost in any case about a million and a half in his jousts with Gould, and gave the new rulers of Erie a wide berth after this.  He swore that he would “never have nothing more to do with them blowers,” and he never did.  But the transactions which brought peace were probably unique, as Fisk judged, in all the annals of “high” capitalism.

3

The Erie ring had returned to New York in triumph.  Jay Gould was president and treasurer of the company, but Jim Fisk, its vice-president, was better known as the Prince of Erie.  Desiring to set himself up in a style befitting the feudal power he disposed of, Fisk caused the offices of the railroad to be moved, upon their return from New Jersey, to the marble halls of Pike’s Grand Opera Palace, at Twenty-third Street and Eighth Avenue, which was then grown to be one of the widest and most fashionable thoroughfares in the city.

From the marble-paved theater lobby at the street level, with its frescoed walls, illuminated by great gas chandeliers with a thousand pendants of cut glass, and ornate with gilded balustrades, a grand staircase ascended to the railroad offices on the second floor.  The officers’ suite was also decorated in Oriental splendor of silken hangings, mirrors, rich rugs, marble statuary and carved oaken furniture.  Close by was a massive strong-box or vault that ran through several stories of the building ;  and in the cellar was kept the famous printing press which was so important a weapon of offense and defense.  The executive offices were surrounded also by a heavy iron grill and guarded night and day against ever present dangers of attack or process-servers.

Here the former circus laborer and notion-peddler, Fisk, with his pard Gould, who had run barefoot over the thistles to tend his fathers cows, throned over their lordly domain.  For his own amusement Fisk launched operettas or musical revues such as New York doted upon in the Opera House below, which became often the scene of “glittering assemblies of fashion”!  He loved the crush of crowds, loved to move among the admiring glances drawn to him, dressed in a scarlet-lined cape, a frilled shirt over his expansive bosom, in the center of which sat the immense flashing diamond sparkler of wide fame.  Behind the Opera House Palace on West Twenty-fourth Street were Fisk’s home and stables, joined to it by a secret passageway.  Close by on the same street was the home he had given to Josie Mansfield.  And with her, or with a pair of his theater queens, all laces and flounces, on either arm, he would go driving to Central Park on fair days, the attraction of all eyes, in his swift, gleaming coach of bright blue with its red running gear.

There was an aura about him, compounded of his gaudy costumes (as a colonel of a militia regiment), his sensational frauds, his scandalous private life, and his charities to poor old women or newsboys who approached him.  In song and story, “Fisk never went back on the poor.”  Florid chronicles of his time likened his life to

the sweep of a fiery meteor, or a great comet . . . plunging with terrific velocity and dazzling brilliance across the horizon, whirling into its blazing train broken fortunes, raving financiers, corporations, magnates and public officers, civil and military, judges, priests and Presidents.

Much of this legend, especially of Fisk’s generosity, was overcolored ;  yet it all had value to this Barnum-like railroad president and goes far to explain the power and prestige he enjoyed.

Behind the ponderous silhouette of Fisk the terribly sober Gould worked unceasingly to exploit his opportunities, which now seemed boundless.  During prosperous seasons, the Erie rulers levied toll as they pleased, much like the Commodore himself, over their own broad territory.  There were trade wars for Gould’s attention at other seasons, armed conflicts with rivals, delicate negotiations with Tammany, forays into the stock market, new consolidations and expansions toward the west ;  and finally there were the many horrendous disasters on the line of the Erie, such as lent the road its picturesque reputation lasting almost down to the present day.¹  But from season to season the young railroad master marched upon his road to fortune, almost unswervingly, exciting the wonder and also the terror of those few contemporaries who had occasion to see him from close by.

Like the great military vassals of other times who might legitimately waylay merchants and pilgrims, unarmed bishops and abbots, or all who passed through their toll roads, so Gould and Fisk took tribute large and small along their right of way.  The case of the Pennsylvania Blue Stone Company, a famous example, showed also their necessary alliance with a statesman such as Tweed.  From the quarries of this flourishing company, the Erie had refused to carry building material into New York unless it received a ransom in the shape of a partnership in the business.  What was the quarrying company worth without the railroad ?  Cut off from its market the company was compelled after a short struggle to accept Gould, Fisk and William Tweed as its partners—these directors of Erie seeing to it thereafter that no other stone was carried over their lines, while Tweed as the head of Tammany arranged that the city government should buy all of the company’s stone at extremely favorable prices.

Other notable adventures of Gould’s involved the preëmption, in similar fashion, of coal mines, ferries and harbor rights ;  of strategic railroad links to the west, for whose ownership the New York Central and the Pennsylvania could be made to “pay through the nose.”  By swift, secret operations he added the weak Atlantic & Great Western Railroad, running between Cincinnati and St. Louis, to his system ;  then the Pittsburgh, Fort Wayne & Chicago, which the Pennsylvania Railroad only wrested from him by hurriedly calling a special session of the state legislature to outlaw his marauding intrusions.  Those who faced Gould with weak arms received short shrift from him.  Even Daniel Drew, ousted in 1868, had tried to raid the stock of Erie in one of his famous bear operations.  Gould, pretending at first to be in connivance with his old mentor, for the sake of financial sport, had suddenly turned and ambushed him, in a brilliantly executed “corner.”  Frantic and weeping, the aged Drew saw himself ruined beyond repair ;  he found the screws turned upon him as mercilessly as he had been wont to turn them upon others ;  he was driven from Wall Street forever after this last disastrous adventure.

The victorious road of a Gould was strewn, according to gloomy report, with the financially lifeless bodies of so many victims destroyed by ruse that he soon came by the name of “the Mephistopheles of Wall Street.”  One distracted victim of his deceiving counsel rushed upon Gould in his private office one day with a loaded pistol, crying out with frenzy that he and his family had been deliberately betrayed and ruined.  Upon the instant Gould, in fear of his life, had given the man a check for the full $25,000 which had been entrusted to him.  It came in time that he must be wary for his own person ;  like one of the nobles of feudal Italy he moved about, defended from physical assault by his bravos.

The post-war period became thoroughly hardened to the repeated collisions between the railroad barons which might burst forth at any moment anywhere in the coal fields of the East or the wild gorges of the Rockies.  The scope of these conflicts varied in accordance with the magnitude of the prize at stake, from mere street clashes to summer campaigns which were not lacking in bloodshed, and were waged fiercely enough with a couple of dozen soldiers, peasants and field hands on either side.

The Erie ring, from Gould and Fisk at the head, to the merest legal and political henchmen who ran its errands, all understood the importance of controlling the new coal fields being opened up in Pennsylvania, and the freight highways which connected them with the markets.  In January, 1869, when a new railroad had been constructed by private promoters for 100 miles between Albany and Binghamton, called the Albany & Susquehanna—at the cost of state and county subsidies—a bitter struggle developed suddenly for the control of this link between the hard-coal regions and New England—a struggle in which the Erie ring met with a signal defeat.

Opposition to the president of the road, one Ramsey, who had worked hard to build it and profit from it, arose from an obscure coal-mining corporation chartered as the Delaware & Hudson Canal Company, under cover of which Gould and Fisk operated (which had its own reason for coöperating with Erie [’62 ed]).  They strove to seize the road as a spur for their own system.  Their agents, carrying bundles of cash, were quickly thrown out into the country to buy up stock held by the townships along the way which had underwritten part of the building cost.  Fisk, taking the field himself, paid bounties for the interest of town councilors, with his usual high-handedness and resolution.  But in the opposing camp he met with uncommonly stout resistance.  To the support of Ramsey came a rival coal company, the Delaware, Lackawanna & Western, out of whose shadows there emerged a new and most vigorous personality, almost as crafty as Gould, and more pugnacious than Fisk himself :  it was the thirty-two-year-old New York banker, J. Pierpont Morgan.

With the share-holdings deadlocked, a duel of legal strokes and counterstrokes began and continued through the spring and summer of 1869.  The board of directors being evenly divided between the two forces, there were sometimes wrestling bouts for control of the stock-books.  Finally, believing that he had sufficient law on his side, Jim Fisk at the head of a dozen Erie porters marched to Albany to take over the headquarters of the little railroad ;  there he encountered the enemy and called on him to stand and surrender.  “Rush in, boys, and take possession—throw that gang out!” he cried.  But some twenty thugs stepped through a door, and hurled Fisk and his men down the stairs of the Susquehanna office.  The Ramsey-Morgan party met force with force, bribe with bribe and duplicity with duplicity.  The outcome of the first phase of battle was that Ramsey and Morgan had possession of the Albany end of the road, while Fisk retired to its western or Binghamton terminus, where with the aid of local authorities he fortified himself strongly.

All traffic on the Albany & Susquehanna stopped ;  its affairs were in lamentable confusion, and the natives along its route, who with high hope of ensuing benefits had invested their savings and taxed themselves for its completion, were not only bereft of transportation but bewildered and frightened at the terrorism of the opposing captains.

The combat took ever new and fantastic turns.  Feeling ran high.  To end the deadlock, the Ramsey-Morgan party finally despatched a force of armed men, estimated by the press to be between 150 and 450 in number, who boarding a train one morning at Albany, rode down toward Binghamton to possess themselves of all the stations on the route and storm the Fisk entrenchments at Binghamton.  At the same time, an equally formidable mixed body of Erie’s Bowery toughs and sheriff’s deputies departed for battle from Binghamton behind their own engine.  Outside of a long tunnel, fifteen miles beyond Binghamton, the enemy locomotives, whistling and tooting their bells wildly, breathing fire and fury, met in head-on collision.  “There was a crash and a smash,” according to the accounts which have come down to us, “and the Albany locomotive rolled off the track, leaving the other without cowcatcher, headlight or smokestack.”

The warriors of both armies had all jumped off as the two steam chariots collided, and yelling defiance had fallen upon each other with clubs, spades, axes and firearms.  But the Ramsey-Morgan thugs were the better armed, and the Erie soldiers soon had the worst of it.  Retreating as fast as they could, tearing up tracks and destroying trestles, they went back toward Binghamton, where they barricaded themselves anew and called regiments of the National Guard to their rescue.

The scene of battle shifted to various courts, under the dispensation of more or less collusive tribunes.  The Albany faction made new issues of stock, after the fashion of Jay Gould ;  and the Erie ring countered with injunctions on the ground of fraudulent stock-watering.  The quarrels of the armed railroad workers, of opposing station-masters at every depot, were exceeded by the contests of separate and rival boards of directors who passed resolutions accusing each other of “fraud, violence, criminal and morally reprehensible practices” in a romantic rhetoric which neither party blushed to use.  More vociferous, the original owners of the Albany & Susquehanna trumpeted their charge that Gould’s party were but “unscrupulous usurpers who, by a sort of legerdemain,” seized control of the stockholders’ property, stole Erie’s money, and so demoralized its service as to bring “calamities of unusual horror, damage and death.”

At last public opinion shifted from high amusement or fascination to anger ;  Governor Hoffman of New York finally moved to take over the railroad at the petition of both factions and operate it until the dispute was ended by the state Attorney-General.  Weary of the stubborn struggle, Gould, who was already absorbed in far greater adventures on another front, was willing to retreat discreetly when Ramsey was once more elected president, on September 6, 1869, and he allowed the Albanians to sell out control at an inflated price to neutral interests.

Pierpont Morgan, who had directed much of the campaign with a ruthlessness which now for the first time called attention to himself, had emerged with much credit.  The balked Erie ring in its turn had acquired some of the unpopularity of Vanderbilt, and the “victory” of the newcomer Morgan was greeted with applause.  He had demonstrated himself a force to be reckoned with, as truculent, as relentless in the fight, as crafty in legal subterfuge as the Erie men themselves ;  and his official biographer relates with pardonable pride that

Mr. Morgan made himself universally respected as an able financier in 1869, when he came out victorious in a memorable struggle for the control of the Albany & Susquehanna Railroad, which had fallen into the clutches of Messrs.  Fisk and Gould.  The contest was waged not only by litigation, but also by force of arms. . . .

The New York Times reflected the general pleasure at the outcome of the weird struggle, concluding: “Justice, though tardy, is on the right track at last.”  Gould and Fisk had won little glory in the affray, but were apparently paid off well in the end.  With his usual aplomb and philosophic detachment, the Prince of Erie rallied his comrades at Pike’s Opera House over their reverses.  “Nothing is lost save honor !” he exclaimed.

4

But all through the summer of 1869, the unfathomable Jay, moving about with soft tread and grave mien, was in pursuit of far greater game than a small Eastern coal road.  It was the mark of his genius that nearly every defeat he suffered was turned into a victory :  in the Albany & Susquehanna affair, after long litigation he was to end by liquidating his hard-won shares at a large profit in the final settlement.  And with each fresh conquest he hastened without rest to undertakings more hazardous and difficult, and of a greater magnitude.  He had a true gift for large affairs, and a kind of virile power to conduct many of them at the same time.  His decisive conquest of Vanderbilt had stamped him as a master of railroad “operations.”  Though in its physical character as a machine of transportation, as a part of the American social-economic order, the Erie steadily augmented its ill-fame ;  although, as the historian Gustavus Myers had estimated, Gould may have added not a locomotive, a train or a station while increasing its fixed capital by about sixty-five millions in the few years of his reign, he might have explained if he wished that such criticisms touched matters of little consequence.  The grand objectives from which his eyes never wavered lay in a totally different direction from any conceivable form of social duty, which in any case no authority was so senseless as to urge upon the great freebooters of his age.

The reservoir of money which lay in the Erie treasury under the nervous hands of Gould was in itself an engine useful for mighty “operations.”  Through its alliance with “Boss” Tweed the Erie ring also had some voice in the management of the New York City funds, amounting to between six and ten millions of dollars, deposited in New York banks.  During seasons when markets were cheerful and money was “easy,” the wizard of Erie could manipulate some twenty millions in currency, in conjunction with the Tammany men.  Now as Gould’s far-flung plans matured he applied with masterly skill the technique of stock speculation which he had learned from Uncle Daniel Drew.

After having sold Erie short at a good moment, Gould would cause his associates to make sudden large withdrawals of cash from the banks under their control, so that money became “tight,” loan rates shot upward (sometimes to over 100 per cent per annum), while stocks and grains and cotton collapsed in time with the planned raids, which were executed from season to season, without warning and with unfailing success.  It was widely known that on certain occasions Henry N. Smith of the brokerage firm of Smith, Gould and Martin, together with Tweed, “drove up to the Tenth National Bank, the Black Friday institution, in a cab, and drew their balances out, Smith alone taking $4,000,000 with him, which he kept several days at home under lock and key.”

Emboldened by his success in corralling a great part of New York’s supply of ready money, Gould’s mind was soon possessed by a scheme which envisaged nothing less than cornering the whole nation’s currency.  With the resources at his command, he could easily manage the floating supply of gold traded in every day in the Gold Room of the New York Stock Exchange.  It remained only to take care of the federal Treasury’s holdings of some seventy-five to eighty millions in some manner.  If he could but lay his hands on this hoard, or neutralize it, the price of gold, metal basis for the national currency, could be manipulated at will and driven up to a tremendously inflated figure.

At the very time of the Erie wars on various fronts, Gould had begun to encircle government officials at Washington.  In May, 1869, Abel R. Corbin, lawyer, speculator and lobbyist, wedded to President Grant’s sister and considered very close to the White House, was tactfully approached by the Mephistopheles of Wall Street, and persuaded to contract for the purchase of $1,500,000 of gold at 133, though without payment on his part.  Corbin, an old man, was very excited at the prospects which Gould unfolded for him, and apparently showed a lively sense of gratitude for the favors extended to him.  To him and to other politicians high in the President’s confidence, Gould also stressed the noble political motives underlying his campaign :  the cheapening of greenbacks, renewed inflation, would cause the Western grain crops to move rapidly, and to be sold in Europe, stimulating all trade, and incidentally enriching the railroads.  For never had farmers and merchants prospered so much as when it had taken, during the war, some $2.80 to buy a dollar’s worth of gold, he argued.  The dollar was too close nowadays to its gold parity ;  gold must be raised again ;  the dollar must fall.

In the gold market, where brokers traded every day against the legitimate currency needs of importers and commercial houses, rumors were stealthily introduced of Gould’s coming campaigns, and in view of the general respect entertained for him as a freeroving economic power, created a vigorous following movement.  But opposed to the bulls in gold were massive vested interests ;  the great banking houses, such as Jay Cooke & Co., which had bought and sold over two thousand millions in government bonds and “legal tender” and reinvested and multiplied their profits in inflated money.  Now they exhorted the government to complete the process of deflation and make all obligations redeemable once more in “hard money” valued at the traditional gold standard.  Upon a rising trend, the tide swayed backward and forward, in response to the masterly touches of Mephistopheles’ golden baton.

In June President Grant, passing through New York on his way to a great Peace Jubilee in Boston, stopped at Corbin’s.  There the confederates besieged him with their entreaties ;  and on board the Providence, the following day, luxurious floating “palace” of the Narragansett Line, belonging to Fisk, Grant had become the guest of the Prince of Erie himself, who paraded in the uniform of an admiral after his own fancy among the glittering mirrors, the carved gilt furniture and the stirring airs of a brass band.  While Fisk, bursting with vanity and flashing with all his sparklers, blocked the view of the assembled journalists and the brilliant crowd, Gould always hovering at the President’s ear pressed his views upon him anew, but got no reply from the stolid little man, who puffed at his black cigar without uttering a word of his opinions.  Disappointment at the President’s evasiveness or uncertainty leaked out ;  gold dropped several points toward 125.

Unresting worker, Gould tried at least to keep himself intimately informed of the government’s immediate fiscal policy.  Through his and Corbin’s direct influence, General Daniel Butterfield, prominent Union League politician and a friend to the Goldbugs (as they were popularly called), was appointed federal subtreasurer at New York.  Propaganda for inflation was now actively disseminated in the press ;  hired lobbyists besieged all the doors of the statesmen.

In New York, for effect, a great banquet was given to Secretary of the Treasury Boutwell, at which the Erie ring played their part ;  and Boutwell, “with a superficial parade of purity and superior, virtue, as well as genius,” according to the New York Herald, “declared that he would not heed the gold gamblers, and that what was done in Wall Street was `none of his business.’”  Gold resumed its rise, and was quoted at 133.

The President’s brother-in-law, Corbin, was then paid a check for $25,000 against his part of the profits, perhaps to show him how it felt, or to inspire him further.  When next the President passed through New York on September 2, 1869, and visited Gould’s accomplice, Corbin seemed to have exerted himself in earnest.  Word went forth like wild fire that Grant had given orders to Secretary Boutwell not to sell any of the government’s gold, advising him to continue “without change until the present struggle between bulls and bears is over.”  In a swift flurry, gold was marked up to 137.

The pool, which had been proceeding cautiously up to now, began its drive in earnest.  A purchase of $1,500,000 in gold was opened in the name of subtreasurer Butterfield, without payment on his part ;  an attempt to confer a similar service was apparently made for General Horace Porter, private secretary to the President.  And then Gould, the inscrutable, toward September 15 disclosed his plans to Jim Fisk (who had by his own relation known them only vaguely and remained skeptical), telling him in a guarded manner probably that Mrs. Grant and thereby her heroic spouse as well were involved in their net.  Fisk now entered the affair with his combined gusto and slyness.  In the marketplace he spread the amazing rumors by queer winks and nods ;  while Gould brought to bear his heaviest artillery with the mathematical precision he was noted for in such engagements.  During the general buying-wave which drove the price of gold above 141, the Tenth National Bank, Tammany-controlled, placed all its resources at the service of the ring.  Its certified checks were issued in unlimited amounts against purchases of gold which were used as collateral.  Up to the night of Thursday, September 23, when gold closed at 144¼, Gould and his confederates were believed to have accumulated forty millions in gold, or twice the available floating supply, thanks to the boundless credits opened by his banks.  The man who in youth had busied himself inventing mousetraps was at the end of September, 1869, in a strategic position to engineer a gigantic “squeeze” in the national money market—unless the government entered the situation in determined fashion.

But here, at this fruitful stage, the alarm was suddenly given.  That perennial friend and watchdog for the people, Horace Greeley, began thundering against the Goldbugs in the Tribune, after September 15, denouncing a vast gold conspiracy and calling upon the Treasury to sell gold and purchase bonds so as to relieve the growing currency tension.  In Washington the Tycoon himself, Jay Cooke, made urgent representations to Boutwell and Grant, while the volatile Wall Street mob with rising excitement swung back and forth from one side to the other.

In their extremity the Goldbugs now applied the screws to the old simonist Corbin, who upon the spot wrote an importunate letter to President Grant, confessing his predicament and beseeching him not to ruin his own kin by unloading the government’s gold.  The slow-moving or wavering military hero, now thoroughly apprized of the situation, was deeply agitated and determined at last to move upon them with the force he usually showed when aroused.  At his order a letter was written by his wife to Mrs. Corbin, urging that Mr. Corbin should sell his gold at once, and stating that the President disavowed all connection with him.  Corbin, paralyzed with fear, must have communicated this alarming turn of affairs to Jay Gould in the night of September 23, or early the following morning.  It needed but little more to convince Mephisto that the game was up.

What Jay Gould’s final dispositions were for the business day that followed will always remain an obscure page of our history.  Fisk always vowed that he was misled, the innocent tool of that “singular man” Gould.  It was strange if no one smiled or coughed at Fisk’s assertions.  He was neither impoverished by his misadventures, nor were his intimate ties with Gould weakened in the least thereafter. . . .

Friday, September 24, 1869, was plainly marked to be the climax of the gold ring’s campaign.  Jim Fisk in person was to unloose an avalanche of buying orders, which would close the great trap, tightening the gold corner unbearably, so that the price might soar toward 200 !  But his buying was to be done in the name and at the sole responsibility of his brokers, Belden and Speyer, according to signed agreements made ready for that fateful day.  The buying drive was to be continued unremittingly with rising pressure until word came by telegraph from Washington during the day that the federal government was in motion.

The market of “Black Friday” opened in pandemonium, after successive days of increasing tension.  Above the uproar could be heard always the bellowing of the stout Fisk to his brokers to bid for all the gold that was offered ;  while reports were circulated publicly that Gould had prepared a list of names of 200 firms which had sold him gold futures, and would demand settlement without mercy.  Starting from 150 gold climbed spectacularly amid frenzied trading to 160 and 165, while concerns of all sorts hysterically directed their agents to buy gold at any price.  The riotous scenes that developed in exchanges all over the country were like to engulf the whole nation in ruins.  During the mad gyrations of the day, from Boston to San Francisco banks and brokerage houses closed their doors, while the streets of the financial centers were thronged by a milling mob.  In Philadelphia, the clocklike indicator of the gold market could no longer keep up with the lightning fluctuations, and finally a black flag with a skull and crossbones was thrown over its face by some distracted humorist, and trading continued under the funereal emblem.  But in the temple of the New York moneychangers the scene, almost surpassing all powers of description, has been painted by Gustavus Myers in a purple passage of his “History of the Great American Fortunes”:

Here could be seen many of the money masters shrieking and roaring, anon rushing about with whitened faces, indescribably contorted, and again bellowing forth this order or that curse with savage energy and wildest gesture. . . . The little fountain in the Gold Room serenely spouted and bubbled as usual, its cadence lost in the awful uproar ;  over to it rushed man after man, splashing its cooling water on his throbbing head.  Over all rose a sickening exhalation, the dripping, malodorous sweat of an assemblage worked up to the very limit of endurance.

What deepened the calamity was not merely the rise, but the catastrophic fall of gold which began with dramatic suddenness at midday as the government swung into action, when Boutwell ordered millions flung upon the market “as publicly as possible.”  Within fifteen minutes the whole structure toppled and the price broke at once to 138.  While brokers swooned in the crush and stampede, “the agony depicted on the faces of men who crowded the streets,” as the newspaper accounts affirm, “made one feel as if Gettysburg had been lost and the rebels were marching down Broadway.”  In the morning men who had been unable to buy gold announced themselves ruined with wild laments ;  and after the noon hour, great numbers who had paid too much in turn announced themselves insolvent with equally unrestrained expressions of grief, and menaces of death to the crazed brokers of the gold ring.

At the height of the frenzy, two of Fisk’s “queens,” by common report, had driven merrily through the financial section to witness their hilarious patron’s triumph.  But they had seen to their horror only a mob of ruined speculators besieging the offices Fisk and Gould were wont to frequent, crying for the heads of the conspirators.  Fisk, perhaps feigning not to have heard of last-minute developments, made his way to the house of the abject Corbin to abuse him for a treacherous scoundrel ;  while Gould had fled from the lynchers by a back door.

Like an inspired fiend, Jay Gould had ridden out the storm to safety.  He, “the guilty plotter of all these criminal proceedings,” as the Congressional Committee of 1870 held, “determined to betray his own associates, and silent and imperturbable by nods and whispers directed all.”  He had miraculously saved himself in the face of disaster on the morning of September 24, selling all the gold he possessed upon the crest of the buying wave evoked by his agents.  The cyclone of calamity had given favoring winds to his escape.  Opinion differed afterward as to whether he had gained nothing, lost all he possessed, or garnered eleven millions of dollars at one coup.

In the aftermath, Jay Gould obtained twelve sweeping injunctions and court orders from his complaisant judges, prohibiting the Stock Exchange and the Gold Board from enforcing contracts or rules of settlement which he broke.  The Erie ring’s brokers, Belden and Speyer—the latter of whom had gone temporarily insane—defaulted completely and none of the bids they made were ever honored.  Their bankruptcy did not affect Fisk in any way, since all the buying they had done to drive up the market was “in their own name and at their sole risk” according to signed documents found in his possession.  Everything had been foreseen !  No written order signed by Fisk was ever found.  It was said that he and Gould had agreed to settle a large annuity for life upon each of the bankrupt brokers, and that Fisk’s payment was through a perfectly satisfactory division of the prize with Gould.

President Grant was compromised by “indiscreet acceptance of courtesies,” for the trail of the investigation, as Garfield wrote confidentially, “led into the parlor of the President.”  Though it did not touch him, it touched a member of his family ;  and so the conventional hearings by legislators ordered in 1870, and directed by men who held stock in the notorious Crédit Mobilier, took evidence which, as Henry Adams has said, “it dared not probe and refused to analyze.”  Executives, judiciary, banks, professions and people were all smirched, Adams concluded, “in one dirty cesspool of vulgar corruption.”

How could Gould as a private individual have been punished for his perfectly legal whim to buy whatever quantities of gold he could obtain ?  There was not a law in the country that struck at the actions of the prodigious “self-made man” and no one understood this better than the unhappy “Railway Congressmen,” Garfield and Blaine.  Moreover, his motives, as he insisted at the ensuing investigation without once losing his self-possession, were blameless ;  he labored only in the interests of the people and especially the Western farmers.  But Fisk had proved to be a bull in the china shop.  He had turned the solemn hearings into low farce.

In a vein of injured innocence he dwelt on the “treachery” of the President’s brother-in-law Corbin.  With his own hands he had tried to punish the old man for his “infamy.”  Then, beside himself with more or less feigned excitement, Fisk called Heaven to witness that he had been wronged.  He desired only to make a clean breast of everything.  Let Mrs. Corbin, and finally Mrs. Grant, he clamored, be brought to the bar of justice.  Alternately frightened and amused, the tribunes in Washington chose to pay him off with immunity, as a respectable merchant placates a loud-mouthed fishwife so that she may leave his respectable premises the sooner.

“Let everyone carry out his own corpse !” Fisk bellowed.  And his inquisitors of the Congressional committee, understanding him perfectly, asked no further questions.  They reported only what everyone knew :  that “for many weeks the business of the whole country was paralyzed” and that the “foundations of business morality were rudely shaken.”

¹ In an appeal to the Railroad Committee of the New York State Legislature (Proceedings of January 14, 1869), Gould himself submitted a confidential letter from his superintendent, in order to show that new issues of bonds and stocks must be authorized.
     The condition of Erie’s rolling stock and tracks was most alarming.  “The iron rails have broken and laminated and worn out beyond all precedent,” warned the official, “until there is scarcely a mile of your road, except that laid with steel rails, between Jersey City and Salamanca or Buffalo, where it is safe to run a train at the ordinary passenger or train speed, and many portions of the road can only be traversed safely by reducing the speed of all trains to 10 or 15 miles per hour. . . . We cannot and do not attempt to make the schedule time with our trains ;  nearly all lose from two to four hours . . . and it has been only by the exercise of extreme caution that we have been able thus far to escape serious accident”
     Such evidence, produced on the pretense that the officers wished funds in order to buy steel rails, aroused the protests of certain “watchdogs” of the public interest, which in turn brought from a vice-president of the road, a certain Diven, the rejoinder :  “The public can take care of itself.  It is as much as I can do to take care of the railroad.”
     Questioned as to the actual value of Erie stock Gould answered candidly :  “There is no intrinsic value to it probably ;  it is speculated in here and in London and it has that value.”