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The Epic Life of Cornelius Vanderbilt

Written by T.J. StilesAuthor Alerts:  Random House will alert you to new works by T.J. Stiles



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Synopsis|Excerpt

Synopsis

NATIONAL BESTSELLER
WINNER OF THE NATIONAL BOOK AWARD


In this groundbreaking biography, T.J. Stiles tells the dramatic story of Cornelius “Commodore” Vanderbilt, the combative man and American icon who, through his genius and force of will, did more than perhaps any other individual to create modern capitalism. Meticulously researched and elegantly written, The First Tycoon describes an improbable life, from Vanderbilt’s humble birth during the presidency of George Washington to his death as one of the richest men in American history. In between we see how the Commodore helped to launch the transportation revolution, propel the Gold Rush, reshape Manhattan, and invent the modern corporation. Epic in its scope and success, the life of Vanderbilt is also the story of the rise of America itself.

Excerpt

The Islander

They came to learn his secrets. Well before the appointed hour of two o’clock in the afternoon on November 12, 1877, hundreds of spectators pushed into a courtroom in lower Manhattan. They included friends and relatives of the contestants, of course, as well as leading lawyers who wished to observe the forensic skills of the famous attorneys who would try the case. But most of the teeming mass of men and women—many fashionably dressed, crowding in until they were packed against the back wall—wanted to hear the details of the life of the richest man the United States had ever seen. The trial over the will of Cornelius Vanderbilt, the famous, notorious Commodore, was about to begin.

Shortly before the hour, the crowd parted to allow in William H. Vanderbilt, the Commodore’s eldest son, and his lawyers, led by Henry L. Clinton. William, “glancing carelessly and indifferently around the room, removed his overcoat and comfortably settled himself in his chair,” the New York Times reported; meanwhile his lawyers shook hands with the opposing team, led by Scott Lord, who represented William’s sister Mary Vanderbilt La Bau. At exactly two o’clock, the judge—called the “Surrogate” in this Surrogate Court—strode briskly in from his chambers through a side door, stepped up to the dais, and took his seat. “Are you ready, gentlemen?” he asked. Lord and Clinton each declared that they were, and the Surrogate ordered, “Proceed, gentlemen.”

Everyone who listened as Lord stood to make his opening argument knew just how great the stakes were. “the house of vanderbilt,” the Times headlined its story the next morning. “a railroad prince’s fortune. the heirs contesting the will. . . . a battle over $100,000,000.” The only item in all that screaming type that would have surprised readers was the Times’s demotion of Vanderbilt to “prince,” since the press usually dubbed him the railroad king. His fortune towered over the American economy to a degree difficult to imagine, even at the time. If he had been able to sell all his assets at full market value at the moment of his death, in January of that year, he would have taken one out of every twenty dollars in circulation, including cash and demand deposits.

Most of those in that courtroom had lived their entire lives in Vanderbilt’s shadow. By the time he had turned fifty, he had dominated railroad and steamboat transportation between New York and New England (thus earning the nickname “Commodore”). In the 1850s, he had launched a transatlantic steamship line and pioneered a transit route to California across Nicaragua. In the 1860s, he had systematically seized control of the railroads that connected Manhattan with the rest of the world, building the mighty New York Central Railroad system between New York and Chicago. Probably every person in that chamber had passed through Grand Central, the depot on Forty-second Street that Vanderbilt had constructed; had seen the enormous St. John’s Park freight terminal that he had built, featuring a huge bronze statue of himself; had crossed the bridges over the tracks that he had sunk along Fourth Avenue (a step that would allow it to later blossom into Park Avenue); or had taken one of the ferries, steamboats, or steamships that he had controlled over the course of his lifetime. He had stamped the city with his mark—a mark that would last well into the twenty-first century—and so had stamped the country. Virtually every American had paid tribute to his treasury.

More fascinating than the fortune was the man behind it. Lord began his attack by admitting “that it seemed hazardous to say that a man who accumulated $100,000,000 and was famous for his strength of will had not the power to dispose of his fortune.” His strength of will was famous indeed. Vanderbilt had first amassed wealth as a competitor in the steamboat business, cutting fares against established lines until he forced his rivals to pay him to go away. The practice led the New York Times, a quarter of a century before his death, to introduce a new metaphor into the American vernacular by comparing him to the medieval robber barons who took a toll from all passing traffic on the Rhine. His adventure in Nicaragua had been, in part, a matter of personal buccaneering, as he explored the passage through the rain forest, piloted a riverboat through the rapids of the San Juan River, and decisively intervened in a war against an international criminal who had seized control of the country. His early life was filled with fistfights, high-speed steamboat duels, and engine explosions; his latter days were marked by daredevil harness races and high-stakes confrontations.

It was this personal drama that moved that crowd of spectators into the courtroom eleven months after his death, but more thoughtful observers mulled over his larger meaning. Vanderbilt was an empire builder, the first great corporate tycoon in American history. Even before the United States became a truly industrial country, he learned to use the tools of ?corporate capitalism to amass wealth and power on a scale previously unknown, creating enterprises of unprecedented size. “He has introduced Caesarism into corporate life,” wrote Charles Francis Adams Jr. “Vanderbilt is but the precursor of a class of men who will wield within the state a power created by it, but too great for its control. He is the founder of a dynasty.”

Adams did not mean a family dynasty, but a line of corporate chiefs who would overshadow democratic government itself. Rockefeller, Carnegie, Gould, Morgan—all were just beginning their careers when Vanderbilt was at his height. They respected and followed his example, though they would be hard-pressed to match it. Few laws had constrained him; few governments had exceeded his influence. In the 1850s, his personal role in Central America had been more important than that of the White House or the State Department. In 1867, he had stopped all trains into New York City from the west to bring the New York Central Railroad to its knees. In 1869, he personally had abated a panic on Wall Street that threatened to ring in a depression.

His admirers saw him as the ultimate meritocrat, the finest example of the common man rising through hard work and ability. To them, he symbolized America’s opportunities. His critics called him grasping and ruthless, an unelected king who never pretended to rule for his people. Still worse, they saw him as the apex of a vulgar new culture that had cast off the republican purity of the Revolution for the golden calf of wealth. “You seem to be the idol of . . . a crawling swarm of small souls,” Mark Twain wrote in an open letter to Vanderbilt, “who . . . sing of your unimpor- tant private habits and sayings and doings, as if your millions gave them dignity.”

Perhaps there were those who understood that Vanderbilt’s true significance was more complex, even contradictory. How could it not be? His life spanned a period of breathtaking changes, from the days of George Washington to those of John D. Rockefeller (with whom he made deals). He began his career in a rural, agricultural, essentially colonial society in which the term “businessman” was unknown; he ended it in a corporate, industrial economy. Neither the admirers nor the critics of his later years had witnessed his role during the tumultuous era of the early republic and the antebellum period. They could not see that Vanderbilt had spent most of his career as a radical force. From his beginnings as a teenage boatman before the War of 1812, he had led the rise of competition as a virtue in American culture. He had disrupted the remnants of the eighteenth-century patricians, shaken the conservative merchant elite, and destroyed monopolies at every step. His infuriated opponents had not shared his enthusiasm for competition; rather, the wealthy establishment in that young and limited economy saw his attacks as destructive. In 1859, one had written that he “has always proved himself the enemy of every American maritime enterprise,” and the New York Times condemned Vanderbilt for pursuing “competition for competition’s sake.” Those on the other end of the spectrum had celebrated the way he had expanded transportation, slashed fares, and punished opponents who relied on government monopolies or subsidies. To Jacksonian Democrats, who championed laissez-faire as an egalitarian creed, he had epitomized the entrepreneur as champion of the people, the businessman as revolutionary.

But the career that started early ended late, and the revolutionary completed his days as emperor. As he had expanded his railroad domain from the benighted New York & Harlem—annexing the Hudson River, the New York Central, the Lake Shore & Michigan Southern, and the Canada Southern—he had seemed not a radical but a monopolist. His role in the Erie War of 1868, with its epic corruption of public officials, had made him seem not a champion but an enemy of civic virtue. He played a leading part in the creation of a new entity, the giant corporation, that would dominate the American economy in the decades after his death. The political landscape had changed as well. With the rise of large railroads and the expansion of federal power during the Civil War, radicals began to think of the government as a possible counterweight to corporate might. Vanderbilt had remained as committed to laissez-faire as ever; as he told the newspapers more than once, his guiding principle was “to mind my own business,” and all he asked from government was to be left alone. He never acknowledged that, as Charles F. Adams Jr. wrote, the massive corporations he commanded gave him power to rival that of the state, and that he became the establishment against which populists armed themselves with government regulation.

Probably no other individual made an equal impact over such an extended period on America’s economy and society. Over the course of his sixty-six-year career he stood on the forefront of change, a modernizer from beginning to end. He vastly improved and expanded the nation’s transportation infrastructure, contributing to a transformation of the very geography of the United States. He embraced new technologies and new forms of business organization, and used them to compete so successfully that he forced his rivals to follow his example or give up. Far ahead of many of his peers, he grasped one of the great changes in American culture: the abstraction of economic reality, as the connection faded between the tangible world and the new devices of business, such as paper currency, corporations, and securities. With those devices he helped to create the corporate economy that would define the United States into the twenty-first century. Even as he demonstrated the creative power of a market economy, he also exacerbated problems that would never be fully solved: a huge disparity in wealth between rich and poor; the concentration of great power in private hands; the fraud and self-serving deception that thrives in an unregulated environment. One person cannot move the national economy single-handedly—but no one else kept their hands on the lever for so long or pushed so hard.

The spectators in that courtroom, then, could mark Vanderbilt down as complicated indeed, even before the first witness spoke. Yet what pulled them there was perhaps not so much his national significance as his strange, powerful character, his mysterious personal life. Public rumor depicted a home wracked by intrigue, spiritualist séances, and Vanderbilt’s controversial sponsorship of the feminist Victoria Woodhull and her voluptuous sister, Tennie C. Claflin. What the public did not see was his emotional complexity: his patient business diplomacy, his love for his first and second wives (as well as his selfishness with them), and his conflicting feelings about his often difficult children—especially Cornelius Jeremiah, who struggled with epilepsy and an addiction to gambling. Contemporaries and posterity alike often would overlook the very human, even sympathetic, side of the imperious Commodore, attracted instead to the most salacious, scandalous, and overblown reports.

It was his final act that brought everyone into that courtroom, an act that combined the personal and the corporate. He had built something that he meant to last and remain in the hands of his own bloodline—to found a dynasty in the most literal sense. To that end, he had drafted a will that left 95 percent of his estate to his eldest son, William. William’s sister Mary meant to break that dynasty by breaking the will, to force a distribution of the estate equally among the ten surviving children. Would she succeed? Each side would fight to define Vanderbilt; each side would seek out its own answer to the enigma of a man who left few letters and no diaries. Lord began to speak, and the crowd bent forward to listen, straining to learn who the Commodore really was.

A CHILD, IT IS SAID, CHANGES EVERYTHING. For Phebe Hand Vanderbilt, another child meant more of the same. In May 1794, during the last month of her fourth pregnancy, her first three children, Mary, Jacob, and Charlotte, ran about their humble house. Knowing the Vanderbilt tradition, she could expect many more to follow the unborn infant in her womb. Continuity, not change, defined everything about her existence, an existence that differed little from that of her parents, grandparents, or great-grandparents. She sat in wooden furniture hand-cut from hand-hewn lumber. She wore clothes hand-sewn from hand-spun wool. She washed cups and plates that had been spun on a wheel, and bottles blown by a craftsman’s mouth. Looking out a window, she would see hand-built wagons harnessed to teams of horses. Peering a little farther, she could watch the sloops and ships that sailed by the shore just steps from her door. And at night she would light the room with a mutton-fat candle or a whale-oil lamp.

Phebe lived in a close wooden world made by human hands, powered by winds and horse and human strength, clustered at the water’s edge. Most of the technology she knew had been first imagined thousands of years before. Even the newest inventions of her time—the clock, the printing press, the instruments of navigation—dated back to the early Renaissance. The “Brown Bess” muskets stored in U.S. arsenals and carried by British redcoats had been designed in the 1690s, a full century before. Revolutions were a matter for politics; the constructed world merely crept ahead.

Phebe lived in Port Richmond, that most ancient kind of community—a farming village, its air pungent with the smell of animal manure and open fires, its unpaved paths sticky with mud from the season’s rains. It sat on the northern edge of Richmond County, better known as Staten Island, a sprawling, sparsely occupied landscape of not quite four thousand souls who still governed their affairs with town meetings. The islanders tilled the steep green hillsides, let pigs wander and forage for themselves, and built their houses close to the soft, swampy shores that crumbled into the kills—the tidal creeks that wrapped around the island’s edges. Staten Island sat like a stopper in the mouth of New York Harbor, separated from Long Island by the two-mile-long Narrows, where the ocean decanted into the bay. West of Staten Island stretched the mainland of New Jersey, and across the length of the harbor sat Manhattan, a long and narrow island that extended between the deep East and Hudson (or North) rivers like a natural pier of bedrock.

An island is defined by its edges. Phebe looked across the water for her husband’s return whenever he was gone, until he sailed up in his boat and tied it fast. His name was Cornelius. It was a solid Dutch name, as was Vanderbilt, and both were common around New York Bay. The first of his family had arrived in America in 1650, when Jan Aertsen Van Der Bilt settled in the Dutch colony of New Netherlands. In 1715, long after the English had conquered the province and renamed it New York, one of Jan’s descendants had crossed the water to sparsely populated Staten Island. That one move was change enough, it seems, for the family that dispersed and multiplied there. The ensuing generations lived out their lives as farmers or tavern keepers, unmoved by the climactic North American war with France in the 1750s, the outbreak of revolution two decades later, the British occupation of their island, the triumph of independence, the ratification of the Constitution, and the swearing in of President George Washington in Manhattan.


From the Hardcover edition.
T.J. Stiles|Author Q&A

About T.J. Stiles

T.J. Stiles - The First Tycoon

Photo © Joanne Chan

T. J. Stiles has held the Gilder Lehrman Fellowship in American History at the Dorothy and Lewis B. Cullman Center for Scholars and Writers at the New York Public Library, taught at Columbia University, and served as adviser for the PBS series The American Experience. His first book, Jesse James: Last Rebel of the Civil War, won the Ambassador Book Award and the Peter Seaborg Award for Civil War Scholarship, and was a New York Times Notable Book. The First Tycoon won the National Book Award in 2009. He has written for The New York Times Book Review, Salon.com, Smithsonian, and the Los Angeles Times. He lives in San Francisco.

T.J. Stiles is represented by Random House Speakers Bureau (www.rhspeakers.com)

Author Q&A

Q: Your last book was a biography of Jesse James. What drew you to Cornelius Vanderbilt as your next subject?
A:
I was drawn by who he was as a person, the lack of writing about him, and the historical themes that defined his life.

Like Jesse James, Vanderbilt was man of action—decisive, dramatic, and always interesting. He courted physical danger, fought high-stakes financial battles, and always set the terms of his existence. Like Jesse James, Vanderbilt has not been the subject of much serious research. And like Jesse James, Vanderbilt opened a window on the making of modern America. Vanderbilt was central to the rise of the corporation, the emergence of Wall Street, and the birth of big business. His was a dramatic life played out on an enormous stage.

Q: How long have you been working on this book and what kind of research went into it?
A:
I worked on it for more than six years. My research was challenging because Vanderbilt kept no diary, preserved no letters, and left behind no collection of papers. Second, the last serious biography about him was written in 1942. The increasing digitization of newspapers and Congressional documents helped, but I did most of my work the old-fashioned way, digging through archives and sitting in front of microfilm readers. My biggest discovery came when I stumbled upon the Old Records Division of the New York County Clerk’s Office; I spent months there going through original lawsuit papers from as early as 1816. I uncovered entire episodes of Vanderbilt’s life that no one ever suspected—fistfights, steamboats ramming each other, inside trading and noncompetition agreements, details about his physical office and epic tales of betrayal. I also focused on Vanderbilt’s associates and rivals, and found priceless letters about him in their papers. Of course, I spent months more going through the papers of his various railroad corporations at the New York Public Library. I found so much new material that I decided to include a lengthy bibliographical essay.

Q: Vanderbilt's was such a BIG (and long) life. His career began before the War of 1812 and lasted until the end of Reconstruction. As you write, it "spanned a period of breathtaking changes, from the days of George Washington to those of John D. Rockefeller." How did you even begin to go about charting a course through this life?
A:
This, surprisingly, was the easiest part. His life fell into three clear segments: His decades as a steamboat entrepreneur in New York’s rivers and coastal waters; his roughly dozen years as an international steamship tycoon; and the final dozen or so years of his life, when he created a railroad empire. Because so much of his business life consisted of combat against economic enemies, the chapters were readily defined by his battles, which rarely lasted more than a year or two each.

Q: What is so stunning about Vanderbilt (among many things) is that his accomplishments were so steady for so long. As you write, “One person cannot move the national economy singlehandedly—but no one else kept his hands on the lever for so long or pushed so hard.” What accounted for his ability to remain on top in so many arenas?
A:
Vanderbilt was a master of both strategy and tactics. Until late in life, he had a close personal grasp on the technical details of his business operations, which he used to obtain every advantage over an opponent. He could cut costs more effectively than anyone, and understood how to, for example, set the times for steamboat departures or price his fares in order to undercut his foes most effectively. When he began to relinquish operational control to subordinates, he demanded the same attention to savings and competitiveness. He also had a farseeing understanding of the overall nature of the transportation business—where passengers were flowing and why, what routes or railroads offered permanent advantages—and picked his battles carefully. Yet he also had two overlooked qualities: He was an expert at making the most of an enemy’s misstep, and he could be a perfect corporate diplomat. He could exploit a momentary mistake by a foe and turn it into a career-changing development. He also cherished his reputation as a man of his word, and his honesty won him respect.

Q: You say that as a railroad tycoon Vanderbilt made his greatest impact not by laying new track but by forging the first giant corporation in American history. What was so ground-breaking (and history making) about the New York Central & Hudson River Railroad?
A:
There are two answers: Its sheer size, and its status as a landmark in the transformation of corporations.

At the time of the Civil War, there were only a handful of corporations with an official, or par, value of $10 million or more. All were railroads, with most manufacturing firms valued at $1 million or (usually) much less. When Vanderbilt merged the New York Central and Hudson River Railroads in 1870, he created an entity with a capital stock worth nearly $100 million, far larger than all but one or two other railroads. It marked the birth of big business: It employed thousands, conducted operations from one end of New York to the other, and loomed as the largest single enterprise in virtually every major city in the state.

But it also marked an end to a longstanding idea of what the corporation was for. They were devices established by state governments to encourage public parties to invest their capital in public projects; the first railroads, for example, had been chartered to serve local areas. Vanderbilt effectively ended the fragmented, localized nature of the railroad system, and he turned corporations into straightforward business organizations, serving shareholders’ interests.

Q: You debunk a lot of myths about Vanderbilt in this book. Why do you think there is so much mythology surrounding his life? What are some of the biggest misconceptions?
A:
Vanderbilt was a paradox. He was a taciturn man, given to secrecy, and, as I said, he left no collection of papers. On the other hand, he was probably the first celebrity businessman. The press covered his personal life, writing about his grand tour of Europe, his expansive race horses, his personal harness races against all comers in upper Manhattan, his summers in Saratoga Springs, his second wedding. In an age when journalists abided by few professional standards, they solved their need for copy about this fascinating but close-mouthed man by simply making things up about him. Rumors flourished on Wall Street in particular, and reporters often printed them as fact. Later writers too often accepted those things as fact.

The misconceptions about him abound. A few examples of flatly false ideas: That he was illiterate; chewed tobacco and spat on his hosts’ carpets; disinherited most of his children; patronized prostitutes; caught syphilis and went insane from it. He did know Victoria Woodhull and Tennessee Claflin, but he had nothing to do with their famous first-female-run brokerage on Wall Street, nor did he sponsor their radical newspaper. His family did not step in to prevent him from marrying Claflin, nor did they arrange his second marriage. He was not an outcast among New York’s social elite. It took decades, but he gradually won the respect of the patrician class, and ended his days as a respected member. Most important, he tempered his famously combative methods as a railroad tycoon. He did not engage in business wars of conquest, but practiced patient diplomacy with neighboring lines, fighting and buying up his foes only as a last resort.

Q: What are the least known periods of his life that you explore in The First Tyco on? What did you discover that most surprised you?
A:
Vanderbilt’s life has always been more obscure the earlier you go. While I found much new information at every stage, I found the most in the first two-thirds of his life. Through the lawsuits of the Old Records Division of the New York County Clerk’s office and the letters of corporate officials, I was able to largely rewrite the story of his first career as a steamboat entrepreneur. I discovered, for example, that he became a railroad president fifteen years before most historians thought he had anything to do with railways—and that he won that position through cunning and largely secret warfare. I learned that his most famous enemy, Daniel Drew, was his secret partner for most of their lives. I discovered information in legal records and the National Archives that transformed one of the most famous episodes in his life, his war against William Walker, who conquered Nicaragua in 1855. I uncovered much new information about Vanderbilt’s family, especially his gambling-addicted son Corneil. What I found allowed me to rewrite the standard portrait of the famous Erie War of 1868, an epic battle against Drew, Jay Gould, and Jim Fisk for the Erie Railway. Perhaps most surprising, though, was my discovery that Vanderbilt adapted his methods, even his personality, when he became a railroad king, pursuing statecraft rather than business warfare. Actually, this just scratches the surface.

Q: Is it possible to contextualize Vanderbilt's wealth in modern equivalent figures?
A:
I am convinced that historical dollar amounts cannot be converted honestly through an inflation calculator. They are irreducible facts that can be understood only in their contemporary context. The economy was not a balloon that inflated over time; in the nineteenth century it was lumpy, with partially integrated markets, periods of rapid growth and dramatic increases in economic complexity, and long periods of deflation. I have my doubts about the accuracy of historical GDP figures, which are often used in comparisons.

On the other hand, the money stock was more accurately calculated, and it does provide some context. Shortly before Vanderbilt died, the comptroller of the currency calculated the combined total of all currency, coin, and bullion in circulation at $900,676,194—just $19.77 for each of an estimated 45,550,000 Americans. If Vanderbilt had been able to liquidate his $100 million estate to American purchasers at full market value (an impossible task, of course), he would have received $1 out of every $9. If demand deposits are included in the calculation, he still would have taken $1 out of every $20. By contrast, Forbes magazine calculated on September 17, 2008 that Bill Gates was the richest man in the world, with a net worth of $57 billion. If Gates could have liquidated his entire estate (to American buyers) at full market value at that time, he would have taken one out of every $138 circulating in the American economy.

Even this comparison understates the disparity between the scale of Vanderbilt’s wealth and that of anyone in the twenty-first century. The calculation for 2008 uses the Federal Reserve’s M2 figure, the most literal equivalent to the 1876 comptroller’s report; the money supply in the far more complex modern economy is generally thought to include a far broader range of financial instruments, a tally referred to as M3. And Vanderbilt dominated in railroads, which outstripped every other sector of the economy in size and importance in a way that no one industry does today.

Q: When did the term "Robber Baron" first become attached to Vanderbilt?
A:
In 1859, The New York Times compared Vanderbilt to the medieval German robber barons on the Rhine, which was the first use of that metaphor. It didn’t use the precise phrase “robber baron,” but it came into common use in the 1860s.

What I think is interesting is how different the original meaning of the metaphor was from its modern definition. Today “robber baron” is applied to industrial monopolists and financiers who corrupt government. What I discovered, though, is that the Times first used it in a sense that was very specific to that time, and makes little sense to us now. It reflected an old strain of thought in the Whig Party, which favored government-led economic development and looked askance at competition, seeing it as anarchic and destructive. The Times criticized Vanderbilt for being too competitive against “legitimate” enterprises—specifically, Pacific Mail, a federally subsidized steamship company, which paid him a large sum to protect its monopoly on a line to California. The politics of the economy were radically different before the Civil War.

Q: How influential was Vanderbilt in making New York America's financial capital?
A:
Vanderbilt contributed enormously to New York’s rise to financial preeminence. First, as a leader of the transportation revolution, he cut fares and improved speed and service in a succession of routes that centered on Manhattan. As an early steamboat and railroad entrepreneur, he made major strides in developing the city’s connections to other major centers—first Philadelphia, then Albany and the Erie Canal, then Boston and the factory districts of New England. As a steamship tycoon, he created lines that linked New York to Europe, and especially to San Francisco, which shipped much of its gold to Manhattan, where it amplified New York’s financial strength. As a railroad president, he built infrastructure and cut costs on the city’s rail links to the West.

Second, he emerged as a major New York-based financier as early as the 1830s, lending money to other capitalists, investing in the stock market, and, most important, revolutionizing finance with his stock operations. He radically increased the capital stock of his companies, a practice derided at the time as “stock watering” but in fact foreshadowing the stock splits that became common in later years. Throughout, he heightened the financial sophistication of corporate structure and the financial markets.

Q: Can you talk a bit about the impact of the Civil War on Vanderbilt and his role in shaping key events of the war? Also his personal role in Central America?
A:
Vanderbilt was deeply patriotic. During the Civil War, he tried to donate his largest steamship, the Vanderbilt, to the Union navy, though he was turned down by the prickly secretary of the navy, Gideon Welles. But when the Confederate ironclad Virginia (a.k.a. Merrimack) went on its rampage, Lincoln personally asked for Vanderbilt’s help. The Commodore outfitted the Vanderbilt with a ram and took it to the scene of the battle, where it bottled up the Virginia. He was then able to donate the ship, worth nearly $1 million. He refitted it as a cruiser to hunt for the Confederate commerce raider Alabama, which targeted Vanderbilt’s California line in retaliation. Vanderbilt also outfitted a major amphibious expedition to New Orleans. Congress gave the Commodore (an informal title) a gold medal in recognition of his efforts and the gift of his steamship.

I was surprised by how closely Vanderbilt worked with the highest levels of the federal government in the 1850s and ‘60s. During the California gold rush, the main channel of commerce and travel between the west and east coasts consisted of steamship lines to Panama, with a land crossing of the isthmus (a railroad across it was completed by the middle of the 1850s). Vanderbilt started a rival line to Nicaragua, which was farther north, and a transit company to carry passengers across that country. These transit operations were probably the first major overseas investments by American corporations, and every president considered them of the highest strategic importance to the United States. In 1855, an American military adventurer named William Walker, who I referred to earlier, essentially conquered Nicaragua, took away the transit rights from Vanderbilt’s company, and gave them to his business rivals. Vanderbilt intervened in a war between Nicaragua and its neighbors, sending gold and a secret agent to lead a commando raid from Costa Rica that cut Walker off from his reinforcements.

Q: Beyond the realm of business, you delve very deeply into Vanderbilt's personal life and family. You write, "The image of Vanderbilt as the man of force is powerful, so much so that it can easily be forgotten that he was a man, emotional and complicated. Here and there, his vulnerabilities and sensitivities poke though the cracks of the stony historical record." What did you most hope to reveal about Vanderbilt the man?
A:
The most important aspect of Vanderbilt as an individual that I hoped to reveal was his simple humanity. For all his strength of will, he could be hurt, confused, in doubt. The stereotype of Vanderbilt is that of a domineering, maddeningly consistent man. When I dug into the archives, though, I found contradictions, inconsistencies, and vulnerabilities that I had never suspected. Though he was fierce in business combat, and brawled in more than one fistfight, he eventually proved himself a consummate corporate diplomat, patient and eager to find common ground. Though he was often hard and demanding with his children, he expressed great warmth for his daughter-in-law Ellen Williams Vanderbilt; her early death deeply depressed him. She was married to Corneil, Vanderbilt’s second son, who was addicted to gambling and epileptic; Vanderbilt’s first wife, Sophia, referred to his attitude toward Corneil as “stubborn inconsistency.” He was by turns encouraging of Corneil’s attempts to reform himself and angry at his thefts and schemes to raise gambling money. He was quite in love with his second wife, Frank, and apologized to her for his outbursts during his fatal illness. He loved his horses, and was hurt by the death of his prize trotter, Mountain Boy, in the “epizootic” of 1872. But he had difficulty managing his own emotional life, and was frustrated by situations that he could not control with decisive action.

Q: You book-end this biography with the court case that transpired after Vanderbilt's death in which his surviving family members battled bitterly for rights to his empire. Why did you start and close with this case?
A:
The trial over Vanderbilt’s will was important because it was a fight to define who he was, and it is the source of much of the information about his private life that has circulated in years since. Unfortunately, a good deal of that information is misleading or simply false. It’s important to remember that one daughter was trying to show that Vanderbilt was not competent to have written his will, so as to leave the bulk of his fortune to his oldest son, William; her side’s so-called evidence was put forward by a paid advocate, and was not impartial. Many of the witnesses called to testify to this point were frankly unbelievable. Even worse, in several cases the daughter’s attorney called a witness and declared what the witness would say; the judge then ruled out any testimony. Yet many writers have cited what the lawyer said, as if it came from the mouth of a real witness.

Given the focus on Vanderbilt’s state of mind, the testimony created a distorted impression. For example, it highlighted Vanderbilt’s interest in Spiritualism. He attended a number of séances, and attempted to contact dead relatives and friends. What the trial did not highlight was the fact that this was quite normal; the post-Civil War years were the height of Spiritualism in American culture, when it was widely practiced. Furthermore, even evidence at the trial shows that Vanderbilt did not rely on guidance from the spirits for his business decisions, but appears to have sought comfort from the dead. Spiritualism was a very small part of his life, yet the exaggerated impression created by the trial has led many to depict it as central to his existence.

Q: Vanderbilt very much wanted his own life and fortune to be the start of a dynasty. Did he get his wish?
A:
Yes and no. He did found a family that remained extraordinarily wealthy for many generations. They reigned over the new aristocracy of the Gilded Age, and a few are still familiar names. Journalist Anderson Cooper, for example, is a direct descendant of Commodore Vanderbilt. Going farther back, Harold Stirling Vanderbilt, who died in 1870, won the America’s Cup in yacht racing and popularized contract bridge. Consuelo Vanderbilt, the Commodore’s great-granddaughter, became the Duchess of Marlborough with a grand wedding in 1895. But Vanderbilt’s son and heir, William Henry Vanderbilt, sold a controlling stake in the railroad empire to a financial syndicate organized by banker J.P. Morgan—though the Vanderbilts continued to serve as chief executives. As America’s first big business, though, railroads were the first to mature and fade, and the New York Central has long since disappeared.

Q: Throughout the book, you highlight Vanderbilt's role in the making of the modern idea of economic regulation. You also write, "The Commodore’s life left its mark on Americans’ most basic beliefs about equality and opportunity." Where in our modern institutions do you think his legacy is most apparent?
A:
Vanderbilt early on voiced a political philosophy rooted in radical Jacksonianism. He believed in individual equality, in the right to compete freely. He denounced monopolies and corporations. This strain of thought remains a key part of American values. Yet he ended his life at the pinnacle of an incredibly unequal society, the master of a giant corporation that overshadowed almost every other business in America. That late-life transformation strongly influenced the new acceptance of government regulation that arose after the Civil War. I don’t think so much that Vanderbilt’s legacy can be seen in our institutions as much as our economic culture—the rise of the modern idea that government should intervene to regulate large businesses, and redress the balance of wealth and power in society.

Q: The Panic of 1873 was the greatest economic disaster in a century. Not only did Vanderbilt survive it but he took advantage of it. What about how Vanderbilt survived that crisis (and others) might be applied to our present circumstances?
A:
The Panic of 1873 was the fourth major panic that Vanderbilt lived through. By the time it struck, he had absorbed the lessons of the previous three: Be prepared. He paid attention to the warning signs in 1872 and early 1873, and began to reduce his own exposure. By the time the panic hit, he held no stock on margin, and had repeatedly told his family and inner circle to stop speculating by buying stocks on credit. As president of the New York Central & Hudson River Railroad, he carried out a major building program, but calculated the costs and benefits with conservative figures, without counting on a continuing boom. He protected his core business from the weaknesses of connecting lines he also owned by delaying plans for consolidating them, choosing instead to keep them organizationally separate. This is why he was in a position to take advantage of falling stock prices and buy control of important companies during the crisis. Having learned to anticipate trouble, he learned to take seriously the indications of approaching trouble, and had a healthy reserve of cash, as did his corporations.

Q: What do you think Vanderbilt would have to say about our current economic climate; its root causes as well as the ever increasing bail-outs of giant corporations?
A:
When the Panic of 1873 hit, Vanderbilt gave an immediate analysis to a newspaper reporter that virtually describes the current situation. The problem was asset inflation: a speculative bubble (in his case, railroads, in our case, real estate) that tamped down skepticism about the value of securities issued by overvalued companies (or, in our case, mortgage-backed securities based on shaky home loans). Eager to ride the rising wave, banks in New York marketed the securities abroad, giving a stamp of approval, much as they have done with mortgage-backed securities today. In other words, Vanderbilt would have understood the root causes of our crisis, despite the great differences in the economy between then and now. And, though he usually looked askance at government intervention, the seriousness of the situation might have led him to approve of strong action. It’s hard to say, because he denounced subsidies, yet after the Panic of 1873 he also urged the federal government to pump new money into the economy. In any case, he would have had a sophisticated grasp of our conundrum.

Q: Now that you know so much about the man and his life what do you think are the key forces—public and private—that led him to become the first tycoon?
A:
What made Vanderbilt so successful is also what makes him so appealing as a subject for a biography. He had an unerring sense for finding the vital center of the American economy. His life is a tour of the events and developments that made the United States the world’s great economic power. During his lifetime, transportation was the most important sector; he not only concentrated in the field, he consistently grasped control of the most important channel of commerce at every stage.

On a personal level, he combined technical mastery with strategic vision with an ability to exploit momentary advantages in ways he could not have predicted at the outset. He was insightful, demanding, exacting, yet—this is key—consistently honorable. He worked hard to build a reputation as a man of his word. He went to great lengths to punish betrayal, yet often came to terms with his foes. Perhaps most important was his unfailing ability to cut costs. He once said that if he could not run a ship or a railroad alongside a rival, and do it for twenty percent less than it cost his competitor to operate, he would close up business and retire. He never had to.

Q: Your own family history recently made national news when it was discovered, at The Smithsonian in Washington, DC, that one of President Lincoln's watches contained a secret inscription from your great-great grandfather. That must have been pretty exciting for you not only as a family member but as a historian who has written extensively about the Civil War. How do you feel about this news and what do you make of all the attention it received?
A: The news accounts floored me. I never expected this favorite family story, one I never quite believed, to enter national mythology. My great-great-grandfather, Jonathan Dillon, was an Irish immigrant who was working in a Washington, D.C., watch repair shop when Fort Sumter was fired on. He happened to be holding Lincoln's watch in his hand. He made an inscription on the back of the dial, closed it up, and said nothing to Lincoln about it. My second cousin, Douglas Stiles, tracked the watch to the Smithsonian's Museum of American History, and convinced the director to open the watch up and check. The message was there--a little different from my great-great-grandfather's memory, but it was there.

I think it struck a chord with the nation at the moment of Lincoln's bicentennial. Here was a plucky, immigrant watchmaker who left a silent message of encouragement in Lincoln's pocket. No fanfare, nothing attention grabbing, just a patriotic, very human little act. I grew up with this story, and named my own son Dillon, in a kind of chain tribute to Jonathan Dillon, the watchmaker. (My father's middle name is Dillon, and of course it was my great-grandmother Isabella Dillon's maiden name.) When he was born in 2007, I often told the story about Lincoln's watch. If I had my doubts about it, I figured that no one would dare tear open Lincoln's watch to check. Glad they did.

As a historian, I found it particularly startling to be brought so close to perhaps the most important American of any era. I wrote about Lincoln in THE FIRST TYCOON. Now I know that, as he held an urgent conference with Cornelius Vanderbilt over how best to deal with the Confederate ironclad Merrimack, he might have had in his pocket a secret message from my great-great-grandfather. The story adds an immediacy to the past, showing how close any one of us is to great historical events.


From the Hardcover edition.

Praise | Awards

Praise

A The New York Times Notable Book
 
A Washington Post, San Francisco Chronicle, The New Yorker, Boston Globe, Christian Science Monitor, and Kansas City Star Book of the Year
 
“A mighty—and mighty confident—work. . . . This is state-of-the-art biography. . . . The First Tycoon has been widely praised, and rightly so. . . . This is state-of-the-art biography.”
The New York Times
 
“Superbly written and researched. . . . Worthy of its subject.”
The Economist
 
“Truly remarkable. . . . A landmark study that significantly enhances one’s understanding of U.S. economic history. . . . [Stiles is] one of the most exciting writers in the field.”
Foreign Affairs
 
“Stiles has painted a full-bodied, nuanced picture of the man. . . . Elegance of style and fair-minded intent illuminate Stiles’s latest, expectedly profound exploration of American culture in the raw.”
The Boston Globe
 
“Stiles, a superb researcher, has unearthed quantities of new material and crafted them into the illuminating, authoritative portrait of Vanderbilt that has been missing for so long.”
The Washington Post
 
“Very absorbing. . . . Much more than a biography. The book is filled with important, exhaustively researched and indeed fascinating details that would profit every student of American business and social history to read.”
San Francisco Chronicle
 
“Stiles writes with both the panache of a fine journalist and the analytical care of a seasoned scholar. And he offers a fruitful way to think about the larger history of American elites as well as the life of one of their most famous members.”
The New York Times Book Review
 
“Vanderbilt’s story is indeed epic, and so is The First Tycoon. . . . Stiles is a perceptive and witty writer with a remarkable ability to paint a picture of the America in which Vanderbilt lived.”
The Christian Science Monitor
 
“Fascinating. . . . A reminder that Vanderbilt’s life and times still have much to teach us.”
Newsweek
 
“Gracefully written. . . . [Vanderbilt] was the right man in the right place at the right time, and the meticulous Stiles seems to be the right man to tell us about it.”
St. Petersburg Times
 
“Stiles has given us a balanced and absorbing biography of this colorful and often ruthless entrepreneur.”
—James M. McPherson, author of Battle Cry of Freedom: The Civil War Era
 
“Monumental. . . . Arresting. . . . Stiles has a gift for making readers admire unsavory characters. . . . [The First Tycoon] resembles a five-course meal at a three-star restaurant: rich and pleasurable.”
—Bloomberg.com
 
“Engrossing and provocative. . . . Stiles draws on exhaustive archival research to clear away the apocryphal and celebrate Vanderbilt as an American icon.”
Tulsa World
 
“At long last a biography worthy of the Commodore, meticulously researched, superbly written, and filled with original insights.”
—Maury Klein, author of The Life and Legend of Jay Gould
 
“Stiles writes with the magisterial sweep of a great historian and the keen psychological insight of a great biographer. . . . With panache and admirable ease, Stiles maps the financial and political currents on which Vanderbilt buccaneered and shows that it was Vanderbilt, more than anyone else, who enabled business to evolve into Big Business.”
—Patricia O’Toole, author of When Trumpets Call: Theodore Roosevelt After the White House
 
“A brilliant exposition of the life of Cornelius Vanderbilt and the entrepreneurial environment that he shaped. Readers will look at Grand Central Station and much else in American life with fresh eyes.”
—Joyce Appleby, author of The Relentless Revolution: A History of Capitalism
 
“The definitive biography of Commodore Vanderbilt. Both as portrait of an American original and as a book that brings to life an important slice of American history long neglected, this is biography at its very best. A magnificent achievement.”
—Arthur Vanderbilt II, author of Fortune’s Children: The Fall of the House of Vanderbilt
 
“Stiles brings the Commodore, warts and all, to life in this new study, which is at once up-to-date in scholarly terms, analytically incisive, and lucidly written.”
Raleigh News and Observer
 
“Sweeping. . . . [A] magisterial, exemplary work . . . [that] offers entry into the storm-tossed world of our current tycoons and the rough waters they have piloted us into.”
American History Magazine
 
“Superbly researched and elegantly written. . . . Stiles’s will likely prove to be the definitive biography of this epic entrepreneur.”
Philanthropy Magazine

Awards

WINNER 2010 Pulitzer Prize
WINNER 2009 National Book Awards

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