KING 1861–1877

Chapter Thirteen

WAR

They came to tell his secrets. Starting at the appointed hour of two o'clock in the afternoon on November 12, 1877, dozens of witnesses took the stand, one by one, week after week, in that courtroom in lower Manhattan. They included friends and relatives of the deceased Commodore, of course, as well as businessmen and acquaintances. But many of the men and women who took the stand were mediums, magnetic healers, and outright confidence artists. They told tales of séances, outbursts, and high emotion—and attorney Scott Lord tried to introduce even more, as he sought to undermine the last will and testament of Cornelius Vanderbilt. It was a burlesque parade of the marginal and untrustworthy (including one woman who had shot a druggist in Baltimore),¹ whose stories left a nearly ineffaceable imprint on Vanderbilt's image.

Most of the witnesses spoke of the Commodore's last years—years of triumph and of loss, years when he outlived so many of his contemporaries, years when he accumulated his greatest achievements. The testimony that best illuminated his final decade and a half, though, came on the first two days of the trial; and it was spoken not by a medium or mesmerist, but by Daniel B. Allen. He had managed the Commodore's businesses from the 1830s onward, tending to bills, organizing corporations, and relaying messages to presidents in Nicaragua and the White House. He was elderly now, and dignified. “A gentleman with silvery white hair and iron gray moustache,” the New York Times described him; “a man who would be noticeable in any assemblage.”²

As he looked out from the witness box at the high, inlaid ceiling, the fluted columns, the bearded faces of the attorneys, he named two years that defined the ultimate phase of Vanderbilt's life: 1864 and 1873. They marked the end of Allen's ties to the Commodore—first of their business, then of their personal relationship. Those two years also defined Vanderbilt's historical role and overarching significance.

The first was a year of transformation, the second of crisis. In 1864, at the age of seventy, Vanderbilt abandoned his lifelong career in shipping as he amassed a railroad realm. Nine years later, he faced the Panic of 1873, an economic cataclysm that forced him to call up all his aged strength and ingenuity to protect what he had built. How he handled these two moments defined his legacy. In the end, he would not only build an empire, he would found a dynasty And his family would never be whole again.

OUTSIDE, THE MASSES WERE MARCHING. Inside, the Commodore mourned.

On the evening of November 2, 1860, a procession of young men advanced on Union Square. They carried torches, waved lanterns, and fired rockets and Roman candles into the night sky. They were Wide Awakes, members of Republican Party clubs that marched in towns across the North as the presidential election approached. As the parade approached the New York Hotel on Broadway, Southern guests gathered on the sidewalk to hiss and make catcalls; across the street, cheers echoed from the Lincoln campaign headquarters. “The din was deafening,” an observer remarked.³

That single scene captured the times: a panorama of mobilization and mutual hostility lit by fire. Everyone remarked on the gathering crisis, except when it seemed to require no comment at all. The Republicans had nominated the Illinois railroad lawyer Abraham Lincoln on a platform of firm opposition to any spread of slavery. The Democrats had splintered. The round-faced and wide-eyed Horace F. Clark stood by his friend, Senator Stephen A. Douglas, who infuriated Southern “fire-eaters” with his insistence on the right of settlers in Kansas to reject slavery; Douglas was nominated by a largely Northern fragment of the Democratic Party. Border-state Whigs and moderate Democrats had created the pro-slavery-yet-Unionist Constitutional Union Party running John Bell for president. The fire-eaters demanded the right to carry slaves into any federal territory; they nominated John C. Breckinridge, who ran on less a platform than an ultimatum. His supporters warned that the South would secede if Lincoln won; as Senator Robert Toombs of Georgia declared, they would “never permit this Federal government to pass into the traitorous hands of the Black Republican party.” But Northern resolve arose in turn, as seen by the torch-waving Wide Awakes.⁴

Away from conventions and parades, inside the four-story brick mansion with brownstone trim at 10 Washington Place, Cornelius Vanderbilt was up to date about the irrepressible conflict. The crisis posed serious questions for the future of his shipping lines between New York and New Orleans, Havana, and Aspinwall. But never far from the front of his mind was a sense of mourning, a sense of loss. It had been six years—nearly seven—since his mother had died on January 22, 1854.⁵ Even for the steely Commodore, the pain endured.

“That irreparable change a death makes in the course of our daily thoughts can be felt in a vague and poignant discomfort of mind,” Joseph Conrad writes.⁶ This modest observation aptly describes Vanderbilt's response to the passing of the eighty-seven-year-old Phebe. Unquestionably he always had revered her, as shown by the rockets he fired in tribute from the North Star in 1853. But after her death a vague and poignant discomfort compounded in his mind like interest on a debt, piling up year after year, until his love publicly manifested itself as it rarely had during her lifetime. Writers who interviewed him began to note his adoration of the flinty old woman who had educated him in the ways of the market. Over a meal in the dining room at 10 Washington Place, Vanderbilt would tell of how, back around 1820, he had invited his mother aboard the first steamboat he had built and owned entirely on his own. “I escorted her aboard and showed her the gay decks and the engine, and the galley,” he would recall. “I was mighty proud of her, I tell you!” (Meaning the boat, not his mother.) Then he took her down to the saloon for a celebratory banquet. “Cornele,” she snapped, “where the devil did you git this dinner?” Even amid the grandeur of his very own steamboat, the food had struck her as an extravagant waste of money⁷

Conrad also notes, “Action is consolatory.… Only in the conduct of our action can we find a sense of mastery over the Fates.”⁸ Perhaps it is not surprising, then, that the long-bereaved Vanderbilt—with all his battles seemingly won, with virtual ownership of the America's sea lanes to Panama and Europe—should undertake a project that took him back to Staten Island. Both his brother Jacob and his son William had taken an interest in the thirteen-mile Staten Island Railroad, in which Billy served as treasurer. “They had very bad accommodations to get to it,” Vanderbilt testified in 1861. “I said I would build a ferry.… It was a kind of hobby of mine.”

A hobby to the Commodore, of course, would have been a major investment to most other men. On June 1, 1860, he began construction at the Simonson shipyard of two new boats to connect with the railroad: the Clifton and the Westfield, costing roughly $90,000 apiece. By the end of the year he had them running from Whitehall Slip to a new railhead at Vanderbilt's Landing; soon he added a third boat, the Southfield. “They cost me an immense sight of money,” Vanderbilt noted. “They run along and did very well; but I never made any money out of them.… The boats I built as a matter of pride.”⁹

It was an inward turn of mind, this hobby of Vanderbilt's, for a man of transoceanic, transcontinental enterprises. It was, perhaps, the turn of a sixty-six-year-old mind increasingly attuned to family and home, to the places of birth and death. But the crisis enveloping the world around him would penetrate even here.

ON NOVEMBER 7, 1860, the New York Herald announced, “END OF THE GREAT NATIONAL CONTEST.” Abraham Lincoln was elected by a plurality of the popular vote, though without a single ballot from the South in the electoral college. Of course, the great national contest had only begun. Immediately the slave states began to convene special conventions to consider the question of departing from the Union. South Carolina voted to secede on December 20, followed by Mississippi on January 9, 1861, followed in rapid succession by Florida, Alabama, Georgia, Louisiana, and Texas. On February 4, delegates gathered for a constitutional convention at Montgomery, Alabama, in order to form the Confederate States of America.¹⁰

Lincoln would not take the oath of office until March 4. In the meantime, attempts to hold the Union together centered in the outgoing Congress and, to a considerable extent, in the ranks of the great merchants of New York. On both counts Vanderbilt found the storm swirling around him. Horace F. Clark (who had not stood for reelection) argued for a constitutional amendment to protect slavery, “to bribe the slaveholders to remain” in the Union, as the Chicago Tribune scornfully remarked.¹¹ On January 7, 1861, Mayor Fernando Wood (who had returned to office after organizing Mozart Hall as a rival organization to Tammany) proposed that, if the South seceded, New York should too, and stand as a free city. No one of note supported him, but the very idea demonstrated how closely the city's economy was tied to the cotton trade, and why so many of its merchants and financiers fought for a compromise. In December, a group led by August Belmont, William Astor, William Aspinwall, Moses Grinnell, Hamilton Fish, and Richard Blatchford had gone to Washington to plead for appeasement. At the end of January, Aspinwall led another elite group to the capital, bearing a petition with thousands of merchants' signatures, asking that the South be placated. “We fear,” Mayor Wood admitted, “that if the Union dies, the present supremacy of New York may perish with it.”¹²

The division of the republic proceeded inexorably; but the question of whether it would result in war centered on Fort Sumter, a federal post on an island in Charleston Harbor. The South Carolinians wanted it. Soon after the new year, the aged General in Chief Winfield Scott dispatched men and supplies from New York to reinforce the slender garrison. The ship he chartered for the job was Vanderbilt's old Star of the West. On January 9, the rebels opened fire on the steamer and drove it out of the harbor. On March 4, Lincoln delivered his inaugural address, appealing to the “mystic chords of memory stretching from every battlefield and patriot grave to every living heart and hearthstone.” The next day he learned that Fort Sumter had barely six weeks before its besieged men would run out of supplies.

General Scott and many in the cabinet argued that Lincoln should withdraw the garrison. Instead, the president decided to resupply the fort, but without blasting his way into Charleston. So far, no shots had been fired at Sumter; some border states still wavered between Union and secession. Lincoln wanted to force the Confederates to fight for the fort, but to place the onus of starting hostilities squarely on them.¹³

On April 5, New Yorkers observed an extraordinary bustle in the army and navy facilities around the harbor as the resupply expedition set sail. A week later, newsboys poured into the evening streets, crying, “Extra—a Herald! Got the bombardment of Fort Sumter!” Walt Whitman, George Templeton Strong, and countless others anxiously read the freshly printed sheets in the glare of corner gaslights. War had begun.¹⁴

War deserves its reputation as the most serious event in national life. It is a grimly wasteful enterprise: the expenditure of resources on materiel that can only destroy, not create, wealth; the termination of lives, usually of young men, at the moment of their greatest energy and potential; the gradual, bitter realization that, as Wellington famously declared, the only thing worse than a battle won is a battle lost. But the Civil War was more extraordinary than most, and more horrible. It brought to a head decades of animosity that had grown into suspicion and flowered into paranoia. Perhaps most important, it was a war for national survival. For the people of the North, the republic they loved had been torn in two. When Virginia joined the Confederacy (along with North Carolina, Tennessee, and Arkansas), the enemy stood across a river from Washington, D.C. Seemingly as one, Northerners decided this could not stand.

On April 15, the day after Fort Sumter was forced to surrender, Lincoln called 75,000 state militiamen into national service to suppress the rebellion. It soon became clear that he would get many more. In New York, once the scene of so much sentiment for compromise, a patriotic frenzy seized the people. Recruiting offices opened, tents popped up at the Battery, rough wooden barracks rose in Central and City Hall parks. “The city seems to have gone suddenly wild and crazy,” one man wrote. On April 20, platoons of recruits practiced marching up and down Broadway to the cheers of onlookers, under flags that hung from almost every building. Some 250,000 citizens packed Union Square for a rally. On Staten Island, Jacob and William Vanderbilt helped organize a mass Union meeting where Horace Clark spoke.¹⁵

But the seriousness of the crisis could not be denied. A panic seized Wall Street as stocks fell, banks called in loans, and depositors withdrew money and hoarded gold. “I believe my assets to be reduced fifty per cent, at least,” Strong wrote in his diary. “But I hope I can still provide wholesome training for my three boys. With that patrimony they can fight out the battle of life for themselves.”¹⁶

Soon the battle of life would seize Vanderbilt's own sons in ways that he could not have predicted in April 1861. For the time being, he had to attend in person to the battle with the Confederacy. Curiously, William C. Jewett (Cornelius Garrison's son-in-law) wrote to Vanderbilt about a “report you are disposed to aid the South.”¹⁷ Quite the opposite was true—but purely selfish interests, not patriotism, first propelled him into wartime affairs. After consulting with William Aspinwall, Vanderbilt wrote to Secretary of the Navy Gideon Welles on April 16, under the letterhead of the Atlantic & Pacific Steamship Company, 177 West Street. “The shippers of specie by our line,” he observed, “are apprehensive that our steamers may be seized or robbed on their voyage from Aspwinall to New York, unless some special provision be made for their safety.” Vanderbilt wanted the government to equip each of the company's ships with a cannon, along with one hundred rifles. “These arms, in the hands of passengers such as ordinarily travel over this route, will be a sufficient protection against any pirate or privateer,” he wrote, thinking perhaps of the hardened Californians who had gone straight from the gold fields to Walker's army.

His concern was well founded. The next day, a group of New York's merchants and bankers begged Treasury Secretary Salmon P. Chase to place guns on Vanderbilt's ships, noting that they carried “$40,000,000 of gold annually from San Francisco to this port.… The capture of even one of these steamers,” they argued, “would stop shipments of gold from San Francisco, or at any rate divert the flow of treasure from New York to foreign countries.”

The Commodore's quick response to the crisis prevented the capture of one ship, the Daniel Webster; he diverted it from its voyage to New Orleans, where the rebels had planned to seize it on April 22. But the danger remained. On April 17, Confederate president Jefferson Davis authorized Southern privateers to attack Northern merchantmen. In June, Captain Raphael Semmes escaped the blockade of Southern ports in the CSS Sumter, the first Confederate commerce raider. It would not be the last. Indeed, Semmes would become a personal problem for Cornelius Vanderbilt.¹⁸

Meanwhile, New York's wealthy men took in hand the problem of mobilization. Before the end of April, they organized the Union Defense Committee, with an office at 30 Pine Street. The members comprised a roster of the city's patriarchs: John J. Astor, Moses Taylor, Moses H. Grinnell, Alexander T. Stewart, Samuel Sloan, William E. Dodge, and nineteen others, of both parties. They raised regiments of volunteers; purchased arms, uniforms, and supplies; issued passes for travel to Washington; and generally assumed governmental functions.¹⁹

To a great extent, this was inevitable. The limited government inherited by Lincoln's administration lacked the financing, the manpower, even the organizational capacity to undertake a major war. The federal budget for 1860 had amounted to just $63 million. (The annual figure would grow to more than $1 billion by the end of the war.) Only sixteen thousand men filled the regular army, and they were dispersed across the western frontier. The navy floated just forty-two ships, not all of them ready for service. Though the army boasted some highly professional quartermasters, they had never dealt with the demands now imposed on them; as James McPherson writes, “The War Department slumbered in ancient bureaucratic routine.” States and private citizens had to assume responsibilities ordinarily reserved for the national government.²⁰

Vanderbilt did not join the Union Defense Committee. He never joined civic organizations or loaned his name to charitable bodies. In part, he hated the formality of the proceedings; in part, he was too proud to be a rank-and-file volunteer. “When the rebellion broke out in 1861 and Mr. Vanderbilt was waited upon by Moses Taylor to take some government bonds,” Lambert Wardell recalled, “he declined to do so, but later on was a large purchaser of the bonds, purely from the standpoint of speculation. It is believed that had the idea originated with him he would have taken the bonds in the first instance, but he was averse to playing second fiddle to Mr. Taylor.”²¹

And yet, his patriotism remained as real and deep as on the day when he had driven Lafayette through the streets of New Brunswick. His opportunity to serve came as the Union prepared amphibious expeditions against the Southern coast. But he grew dissatisfied—even angry—as the War Department and navy began to charter his ships. “The moment a man comes to New York he is surrounded by a lot of thieves all the time, and in every shape and direction,” Vanderbilt told a committee of the House of Representatives later that year. Ship brokers swarmed around the federal officials in charge of the charters, inserting themselves as middlemen for either the government or the private owners.

“I am to give a man, one of these outside thieves,” Vanderbilt stated increduously “two and a half percent commission on that charter.”²² The idea offended both his patriotism and his sense of commercial justice—but he had a solution. On April 20, he wrote to Navy Secretary Welles, “I feel a great desire that the government should have the steamer Vanderbilt, as she is acknowledged to be as fine a ship as floats the ocean, and, in consequence of her great speed and capacity, that, with a proper armament, she would be of more efficient service in keeping our coast clear of piratical vessels than any other ship.” He suggested that the sale price be determined by any three men with the rank of commodore (still the highest in the navy), recommending the eminent Robert Stockton as one of them. “If this will not answer,” he added, “will the government accept her as a present from their humble servant?” In addition, he offered to sell the Ocean Queen, the Ariel, the Champion, and the Daniel Webster on the same terms.²³

“There is no such water craft afloat, and I know it,” Vanderbilt later testified before Congress, speaking of the Vanderbilt. “But he [Welles] would not hear it, and did not answer my letter.” Instead, Welles wrote a note on May 2 to Captain Samuel L. Breese, commandant of the Brooklyn Navy Yard, saying he did not want the Vanderbilt. “The complement originally ordered is full,” he stated, and the great steamer was “of a larger and more expensive description than the service is supposed to require.”²⁴

Why turn down a gift—the most “princely and munificent” ever offered by an individual to the government, in the words of the New York Herald? Perhaps Welles expected the war to end soon, as many did, and did not want to be left with an unnecessarily large and expensive-to-run ship. The secretary was also a man with a great deal of pride. The idea that his fleet needed Vanderbilt's help may have insulted him. Perhaps most important, there was tension between the War Department and the navy. Much of the chartering of merchant ships was not conducted by naval personnel; and Welles seems to have viewed all transactions with commercial men with a bit of cynical distaste.

So the Vanderbilt would not be “at the head of the navy, where she ought to be,” as its owner believed. Instead, it would be chartered as a mere transport, along with most of the sidewheelers run by the Atlantic & Pacific Steamship Company, as the “outside thieves” collected their 2.5 percent and drove up the price. Vanderbilt received $2,000 a day for his great ship; in the end, the federal government would pay him a total of $303,589.10 for the use of that vessel alone—approximately one-third of its original cost. Yet even this fee was not as unreasonable as it might seem. Vanderbilt paid all costs of operation, which could amount to $600 a day under ordinary circumstances, and bore all risks except for actual combat; the peculiar demands of wartime operations could raise that operating cost far higher. (Boiler fires had to be kept burning at all times, for example, to allow for a quick escape or to avoid collision in a dense fleet.) The charge of extortionate pricing would prove persistent, but it was not well founded. In any case, he never wanted to charter his steamers in the first place. “The fact is, I would rather sell every ship I have,” he testified. “I, myself, am not a fair criterion for other men. I would rather sell my ships than let them remain in the government employ until they earn their whole value and then have the ships and the money too.”

He did finally sell two boats to the navy in 1861—two boats he did not want to let go: the Clifton and the Westfield, of the Staten Island Railroad ferry, for $90,000 each. The navy's agent was George D. Morgan, cousin to Governor Edwin D. Morgan of New York and brother-in-law to Gideon Welles—who took his 2.5 percent. As Vanderbilt wisely observed, New York had thieves in every shape and direction.²⁵

WAR BROUGHT George Washington Vanderbilt home.

On July 1, 1860, he had graduated from West Point after the standard five years. (George Custer graduated in 1861 in the first four-year class.) The regular army was stingy with promotions—so stingy that it did not even grant him the rank of second lieutenant, the very lowest for commissioned officers. Instead, it named him brevet (honorary) second lieutenant. He was dispatched to Fort Dalles in Oregon, where there recently had been hostilities with Indians. He had arrived on December 4, 1860, only to be recalled on January 28. Posted to Fort Columbus on Governors Island, he finally received the full rank of second lieutenant in the 10th Infantry Regiment on February 27, 1861. With the outbreak of war, the army assigned him to the unglamorous task of training the recruits who signed up by the thousands.²⁶

Of the Commodore's three sons, George remains the most mysterious. William was dutiful, diligent, and dull, the colorless farmer and manager whose profile steadily rose higher without ever seeming any larger. Corneil flared fitfully into public view, with his epileptic fits, episodic gambling, and artful begging from prominent men. But George exists in the historical record as little more than a shadow, defined largely in contrast to his brothers. He was brave and strong and manly, legend tells us, the pride of a father who wanted so much to have a Vanderbilt to be proud of. This comes to us as more an impression than even an anecdote, but perhaps it is true; William named a son after his brother, after all. But hidden by the warm glow of the honored memory of a Civil War veteran is lurking disappointment.

For one thing, George seems to have struggled at the Military Academy, where he graduated thirty-ninth out of forty-one, only one step above his lowest point. Custer, of course, graduated last in his class and still went on to fame in the war. But the two Georges had different fates. Hardly had the hostilities begun than the Commodore's son found himself standing before a court-martial. On the afternoon of May 16, he had disappeared from his training duties at Fort Columbus. He had returned the next day without explanation. At his trial on May 29, he made no defense, and was sentenced to one month of confinement to the fort, after which he returned to duty.

The conviction seems to have marked him. Though it is always difficult to understand why a military bureaucracy treats any individual the way it does, the army shunted him aside, despite its need for every regular army officer it could find, as it created hundreds of new regiments of U.S. Volunteers (temporary units for the duration of the war). Men such as Ulysses S. Grant and William T. Sherman, West Pointers who had retired after rising no higher than captain or lieutenant, returned to service and rapidly became generals. But the army sent George to Boston. There, on September 1, he took charge of the recruiting station, replacing an officer who was given command of his own regiment. It appeared that if the Vanderbilts were to gain any glory in the Civil War, the aged Commodore would have to win it for himself.²⁷

IT HAD BEEN A YEAR of defeat upon defeat. Bull Run, Wilson's Creek, Ball's Bluff, and Lexington, Missouri: such was the legacy that Edwin M. Stanton inherited when he took office as secretary of war in January 1862. Overbearing, incisive, and fiercely honest, this former U.S. attorney general brought a determination to reform a department demoralized by the inefficiency and corruption that had prevailed under his predecessor, Simon Cameron. “Stanton impresses me and everybody else most favorably,” wrote Strong. That ubiquitous observer met Stanton in Washington on January 29. “Not handsome, but on the contrary, rather pig-faced. At lowest estimate, worth a wagon load of Camerons. Intelligent, prompt, clear-headed, fluent without wordiness, and above all, earnest.”²⁸

As his secretaryship began, Stanton could count a rising number of victories and advantages. Even before he came into office, amphibious expeditions had captured key fortifications along the Southern coastline. In February, General Ulysses S. Grant won rousing twin victories at forts Henry and Donelson in Tennessee. And General George B. McClellan now commanded the Army of the Potomac, which he organized, trained, and equipped superbly. McClellan planned a new offensive against the Confederate capital, Richmond, Virginia. He would land his army at Fortress Monroe, at the tip of the peninsula that extended east from Richmond between the York and James rivers. From Monroe (still in federal hands), he would strike west. In March, swarms of men loaded dozens of ships with arms and supplies as the great expedition prepared for departure.

On March 8, it seemed that the Confederates would stop McClellan's Peninsula Campaign before it could begin—indeed, that they would annihilate Union maritime power at will. That day, a strange craft steamed out of Norfolk harbor at the creeping speed of about four knots. It resembled a turtle or, as someone at the time described it, the roof of a submerged barn. It was the salvaged hull of the Merrimack, a U.S. frigate scuttled at the Norfolk naval yard that the Confederates had salvaged, covered in iron plate, and renamed the CSS Virginia. (The Union persisted in calling it the Merrimack.) It steamed straight for the Union blockade squadron at Hampton Roads, the waters at the mouth of the James River, where it sank two ships. A third, the Minnesota, ran aground in shallows where the deep-draft Virginia could not go with its deadly ram. During the fight, solid shot ricocheted off its armor shell. The Virginia suffered internal damage, but outwardly it seemed invincible.²⁹

“Stanton was the most frightened man that I ever saw,” Gideon Welles afterward reflected in his diary. When news arrived of the Virginia's rampage, “I called at once on the President, who had sent for me,” he wrote a few years later. “Several members of the Cabinet soon gathered. Stanton was already there, and there was general excitement and alarm.” The secretary of war, he recalled, “was almost frantic.… The Merrimac, ^*1 he said, would destroy every vessel in the service, could lay every city on the coast under contribution, could take Fortress Monroe—McClellan's mistaken purpose to advance by the Peninsula must be abandoned.” Both Lincoln and Stanton, he added, “went repeatedly to the window and looked down the Potomac—the view being uninterrupted for miles—to see if the Merrimac was not coming to Washington.”

Welles's spies had followed the progress of the Merrimack turned Virginia all along. In fact, the navy secretary had multiple ironclads of his own under construction; one had just been completed in New York, and it departed immediately for Hampton Roads. It was a small, raft-like craft with a revolutionary rotating turret that mounted two guns. It was called the Monitor. On March 9, it battled the Virginia to a standstill.³⁰

So ends one of the set-piece stories of the Civil War: the historic first clash of ironclads, the tale of the Monitor steaming onto the scene just in time to prevent the complete destruction of the Union fleet. Certainly that was the story that set itself firmly in the memory of Welles, who felt a deep antipathy toward Stanton. But history went on after the indecisive battle of March 9. The Monitor had not defeated the Virginia; it had merely stood off the enemy. The rebel ironclad still lurked. If the Monitor simply suffered a breakdown—a commonplace occurrence in a newly launched ship—then nothing could stand in the Virginia's way.

On March 14, five days after the clash between the two armored vessels, General John E. Wool, commander of Fortress Monroe, sent a frightened telegram to Stanton, arguing that the Virginia might “overcome the Monitor.” The next day, Stanton had an aide telegraph Vanderbilt in turn: “The Secretary of War directs me to ask you for what sum you will contract to destroy the Merrimac or prevent her from coming out from Norfolk—you to sink or destroy her if she gets out? Answer by telegraph, as there is no time to be lost.”³¹ Welles later mocked Stanton's anxiety. “He had no faith in the Navy officers nor me, nor anyone else,” he wrote long afterward, “but he knew Vanderbilt had big steamers.” Welles apparently forgot that, on March 14, he himself assigned Gustavus V. Fox, the assistant secretary of the navy, to get the Vanderbilt from New York.³²

The Commodore seems to have been away from home, but William B. Dinsmore, president of the Adams Express Company, tracked him down. Vanderbilt wired Stanton, through Dinsmore, that he would come to Washington on March 17.³³ On that Monday morning, “I called at the War Department, where I saw for the first time Mr. Stanton, the Secretary of War,” the Commodore wrote four years later. “He requested me to accompany him to the Executive Mansion.” Vanderbilt and Stanton were similar men in many ways, both tough-minded, demanding, and immensely capable. They clearly got on well as they walked together to the White House, “where,” the Commodore went on, “I was introduced to Mr. Lincoln, to whom I was then personally a stranger.”³⁴

Now approaching the age of sixty-eight, Vanderbilt experienced the rare sensation of meeting a much taller man. Lincoln asked if Vanderbilt could do anything to keep the enemy vessel from steaming out of Norfolk once more. “I replied to him,” the Commodore wrote, “that it was my opinion that if the steamship Vanderbilt was there properly manned, the Merrimac would not venture to come out; or if she did, that the chances were ten to one that the Vanderbilt would sink and destroy her.” Then the president asked his price. “I at once informed Mr. Lincoln that I was determined that I would not allow myself to do anything by which I could be ranked with the herd of thieves and vampires who were fattening off the Government by means of army contracts,” Vanderbilt recalled, “that I had no vessels to sell or bargains to make, except one.” He would give the Vanderbilt to the government on the condition that he, the Commodore, should control its preparations for battle. Lincoln replied, “I accept her.”

“They asked what my plan was,” Vanderbilt recollected, “and I said, to keep steam up and protecting my vessel as much as possible by various means; to run right into the rebel and drown him; that no vessel had been, or could be, made by the rebels that could stand the concussion or stand before the weight of the Vanderbilt.” Lincoln asked how soon he could have the great steamship at Hampton Roads. “The Vanderbilt should be at Fortress Monroe properly equipped and officered, under my direction, within three or four days at the farthest,” he answered. Vanderbilt then left immediately for New York. With the fate of McClellan's planned expedition in peril, with fears for the entire blockading fleet, he had no time to spare.³⁵

During those rushed few days, Vanderbilt directed the refitting of his flagship in the Simonson shipyard at Greenpoint. His primary effort was to equip it as a ram. Treasury Secretary Salmon P. Chase inspected it soon afterward. “She was already strengthened [about] the bow with timbers,” he wrote, “so as to be little else for many feet (say 50) from the prow than a mass of solid timber plated outside with iron.” On March 20, the Commodore telegraphed Stanton to ask for formal authority to hunt for the Virginia. “The ship leaves to-morrow,” he wrote. The war secretary promptly wired back to Vanderbilt's office at 5 Bowling Green, “The President and this Department are highly gratified at your promptitude, and that you are so far forward.” In the formal order, Stanton wrote, “Confiding in your patriotic motives and purposes, as well as in your skill, judgment, and energy, full discretion and authority are conferred upon you to arm, equip, navigate, use, manage, and employ the said steamship Vanderbilt, with such commander and crew and under such instructions as you may deem fit.” The next day, Vanderbilt departed for battle.³⁶

“Commodore Vanderbilt,” Stanton commented to General Henry Halleck on March 25, “is now at Norfolk to meet the Merrimac, and although not armor-clad, he is very confident of being able to run her down.” Many observers shared his optimism. “The immense size, great weight, and speed of the Vanderbilt especially would seem to make her a terrible opponent in an encounter of that kind,” remarked the Journal of Commerce. “An unwieldy floating battery, lying low on the water, could not survive many blows from a vessel of her weight.” The Vanderbilt was “put in fighting trim,” the London Times reported. “Her steam machinery has been protected by rails in the most ingenious way, and also by cotton bales and hay. Her prow has been armed with a formidable nose, with the intention to poke it right into the side of the Merrimac.… Its edge is made of steel, and very sharp.”³⁷

Vanderbilt steamed up to Fortress Monroe in his titanic vessel, its immense sidewheels churning the water, smoke billowing out of its twin funnels. On going ashore, he consulted with General Wool and Commodore Louis M. Goldsborough, commander of the squadron so badly beaten in the first battle with the Virginia. Goldsborough impressed Vanderbilt, who turned his ship over to the officer (under the immediate command of Vanderbilt's own captain), despite Stanton's wish to keep it in the War Department's control. Vanderbilt returned to New York, sick with a cold, and explained himself to Stanton. “As for Commodore Goldsborough,” he wrote on March 31, “he is a trump. I think to be depended upon. He had given Captain Le Ferre directions, which accorded exactly with those that I had given him before leaving New York. So I left this matter undisturbed. My opinion is that the Merrimac will not venture outside of Fortress Monroe. If she does, I am quite certain she never can return.”³⁸

His enemies feared that he might be right. The rebels respected “the powerful steamer Vanderbilt, fitted with a ram expressly to attack the Virginia” as Confederate Flag Officer Josiah Tatnall reported on April 30. With its great speed, it could easily outmaneuver and run down the Virginia(which could do no better than five knots), and sink it with its enormous weight, even if the ram did not carve open the rebel ship. As one Confederate officer recalled, “We were primed for a desperate tussle.”³⁹

By now McClellan had landed the Army of the Potomac on the peninsula and proceeded to waste week after week besieging Yorktown. In early May, Lincoln himself visited the front, accompanied by Treasury Secretary Chase. One day, he and his party saw the telltale trail of smoke that indicated the Virginia was coming to fight. On May 7, Chase wrote to his daughter of how “the Merrimac came down & out—how the Monitor moved up & quietly waited for her—how the big wooden ships got out of the way, that the Minnesota & Vanderbilt [might] have fair sweep at her & run her down—how she wdn't come when they cd—how she finally retreated to where the Monitor alone cd. follow her.” The Vanderbilt performed its task as Vanderbilt predicted: the Confederates refused to risk the Virginia against his ship. Lincoln personally ordered an attack on Norfolk, and the retreating rebels scuttled their ironclad.⁴⁰

Vanderbilt did not win glory in battle, but he played a key role in bottling up the Virginia, allowing the federal authorities to regain their confidence and the Peninsula Campaign to proceed (though to ultimate failure in the Seven Days' Battles). His ship remained in the fleet, where he always had thought it belonged. It was indeed a magnanimous gift—and one that would be remembered by Captain Raphael Semmes.

IF WALL STREET HAD SAINTS, then the college of financial cardinals would surely canonize Elbridge G. Spaulding. Spaulding, chairman of a House subcommittee on emergency measures, performed a true miracle: he conjured money out of nothing, and so contributed more toward the Union victory (and the future of New York's financial sector) than any single battlefield victory.⁴¹ Though his eminently forgettable name is eminently forgotten today he was one of the most important architects of the invisible world of commerce that emerged in the nineteenth century. In the nation's darkest hour, he took the increasingly abstract economy and completely abstracted the most solid thing of all: the dollar.

In the opening months of the Civil War, the financial markets staggered along in doubt and fear. These “financial markets” included not only the stock exchanges, but also farmers in Missouri and Michigan, merchants in Danville and Davenport, who clutched the paper notes and deposit receipts issued by local banks; which in turn deposited much of their reserves in New York banks; which in turn made their surplus funds available as call loans to stockbrokers; who in turn provided credit to clients for purchases of securities on Wall Street. The uncertainty of war caused many across the country to withdraw deposits or return notes for gold, ultimately draining reserves in Manhattan. Then, too, Secretary Chase borrowed heavily in New York to finance the war. Following Jack-sonian treasury laws to the letter, Chase refused to open accounts with the banks; instead, he insisted that gold be carted from their vaults through the twisting streets of lower Manhattan to the federal subtreasury The specie lingered there, out of circulation, for weeks or even months before it was spent.

As banks struggled with reduced reserves, the Union suffered the string of setbacks that marked the fall of 1861: the loss of Lexington, Missouri, in September; defeat at Ball's Bluff, Virginia, in October; and McClellan's long refusal to advance on Richmond. When the navy seized two Confederate diplomats at sea, on their way to London, it seemed that war with Britain might ensue. Banknote holders rushed to redeem their paper money for gold, which they hoarded; banks called in loans; stock prices fell, causing panicked selling, causing prices to fall faster, erasing their value as collateral for borrowers. In short, a panic ensued. The banks of New York had no choice but to do the unthinkable (indeed, the illegal under state law): by mutual agreement, they ceased to pay note holders and depositors in specie on December 30.⁴²

“There is no such thing as gold and silver coin circulating in the country,” declared Senator John Sherman. “It is stowed away.” Hoarding threatened to strangle the North. Gold was the stuff that made Americans comfortable with the imagined devices of economic life; when it disappeared from circulation, the public began to give the emperor's wardrobe a second look. Sherman warned that the economy might break down, that the government might find itself unable to secure funds from the private sector. The war would be lost. “We must have money or a fractured government.”⁴³

Congressman Spaulding found a solution. A banker in private life, he drafted a law to issue federal notes that could not be redeemed for specie. They would be legal tender, which meant that they had to be accepted as payment for any debt; only customs duties and interest on federal bonds would be paid in gold. Lincoln signed the Legal Tender Act on February 25, 1862, and the Treasury began to issue $150 million in “greenbacks,” as the new bills were nicknamed. (In July came $150 million more.)

“The new currency began to be seen in the Exchange brokers' offices early in April, first in large notes of $1,000, then of $500,” recalled Wall Street speculator William W. Fowler. “In a fortnight, it was coming on in sums counted by the million.… From Washington, they came back to the sub-treasury in New York by the express-wagon load, in boxes and in bags, but generally done up in packages the size of small bricks, in brown paper, tied with red tape, sealed with the treasury seal, and numbered and marked; at the sub-treasury, they were paid out.” The flood of money revived the markets, he wrote, “as if by magic.”⁴⁴

The greenback started a massive reconstruction and expansion of the invisible architecture of the economy, institutionalizing New York's existing centrality to the financial system. In 1863, the National Banking Act created a network of federally chartered banks, which were required to purchase federal bonds and to deposit their cash reserves with banks in reserve cities; banks in reserve cities had to deposit their own cash reserves with banks in New York. This sanctified in law the pyramiding of cash and credit in Manhattan that had occurred before the war, strengthening the mystic cord of money that stretched from the hearthstones of western farms to stockbrokers' offices in Wall Street. The act also allowed such banks to issue national banknotes, which were redeemable in greenbacks, not gold.⁴⁵

The revolutionary nature of all this can scarcely be overestimated. On one hand, it suddenly overturned long-standing traditions concerning the role of the national government in the economy. Jackson had staked his presidency on the fight against the federal charter of one bank (albeit an enormous one); now Washington chartered hundreds of banks, dictated how they would structure and place their reserves, and even issued a national paper currency for the first time since the ratification of the Constitution. In addition, Congress enacted a federal income tax in 1861, also for the first time, extending the touch of the central government to individuals through an extensive new bureaucracy as never before. As one New Yorker wrote in his diary, “The direct tendency of all the acts of the administration and the great aim of the Republican party is toward a strong consolidated Govt overriding state constitutions or laws.”⁴⁶ It was not a party platform but a war for national survival that drove this process, and radically redefined what Americans accepted as legitimate federal activity.

Perhaps the most revolutionary innovation of all was Elbridge Spaulding's greenback. The idea of “fiat money” (as economists call irredeemable legal tender) offended economists and businessmen, who believed that it would spark disastrous inflation. Old Jacksonians saw it as a dangerous step that opened the economy to political corruption and manipulation. Going deeper, the Legal Tender Act represented a direct attack on the ancient worldview that was rooted in the tangible and real, by declaring that mere markers, the product of imagination alone, would be the medium of exchange and store of value. Serious, knowledgeable men—men such as Hugh McCulloch, a future secretary of the treasury—argued, “Gold and silver are the only true measure of value. These metals were prepared by the Almighty for this very purpose.” Now Spaulding made straight what God had made crooked.⁴⁷

The greenback did lead to unforeseen complications. Since the Legal Tender Act did not eliminate the gold dollar, it created two currencies—both denominated as dollars. The supply and demand for each varied, so the value of the greenback fluctuated against the gold dollar. An improvised currency exchange soon emerged in New York, later transformed into a formal trading floor called the Gold Room. There brokers determined the “gold premium”—the price in greenbacks of one hundred gold dollars (e.g., a gold premium of 115 meant $115 in greenbacks would buy $100 in gold coin).^*2 Gold stayed out of circulation within the country for the most part (due to the effect known as Gresham's law), but it remained the exclusive form of payment in overseas trade; the Gold Room, then, became the international currency exchange, and thus essential to American foreign commerce. But the value of the greenback also fluctuated with the fate of Union arms on the battlefield. As an abstract unit, created by law, it represented only the strength of public confidence in the federal government. Defeats damaged the greenback; victories brought the two dollars closer in value. Whenever a military campaign began, speculators would gamble on the result by buying greenbacks or selling them short. Essential or not, the gold market began to look seditious.⁴⁸

“I never cared anything about your gold or paper money,” Vanderbilt later testified. “I always considered it the same thing with me. If it had cost $1,000 in gold and I paid for it with $1,000 in paper… I say there is no difference.”⁴⁹ He spoke after the end of the war, when the gold premium had grown smaller and less volatile; during the worst of the conflict, when a gold dollar commanded as many as three greenbacks, he undoubtedly paid more attention to the difference.⁵⁰ But his casual dismissal of this revolutionary development says much about his mind. After five decades on the forefront of economic change, he easily accepted this innovation. Flexible and pragmatic, he saw Spaulding's miracle as a minor change in the rules.

More important was the sudden acceleration of the pace of the game. In 1861, he had continued his business life much as before. At sea, he had withdrawn his European line, but he remained the guiding spirit of the Atlantic & Pacific Steamship Company. He had received his last payment of $105,050.67 from Pacific Mail, in which he remained the largest stockholder (receiving 15 percent, or $15 per share, in annual dividends). On land, he continued to serve on the board of the Hartford & New Haven Railroad (now paying annual dividends of 12 percent), and he held his seat as a director of the Harlem Railroad, though he rarely attended meetings now that he had helped reduce its floating debt to a manageable $43,789. He also indulged in his own version of charity when he agreed to pay off a mortgage held by a Mrs. Herndon, at the request of Chester A. Arthur, a politically active lawyer and future president. “This will save her from being annoyed with a mortgage,” he had written to Arthur on October 8, 1861, “& can pay at her pleasure.” And, in a curious echo of the war in Nicaragua, Parker French, William Walker's one-handed confidence man, was arrested in November as an organizer of the Knights of the Golden Circle, a shadowy pro-Confederate conspiracy in the North. Then, in 1862, everything began to move much faster.⁵¹

The old commercial heart of the city had pulsed with cotton, beating in time to Southern harvests and exports. Seemingly overnight, a transplant gave New York a new, industrial, Northern heart of coal and iron and rifles and tents and shoes and uniforms. Greenbacks and military purchase orders flowed into New York and quickly revived business. Factories, workshops, and warehouses could not meet demand, so new factories, workshops, and warehouses opened. The wave of investment and confidence sped up life on Wall Street dramatically. In early 1862, the Open Board of Stock Brokers organized in a dark basement room on William Street. Known as the “coalhole,” it was a literal trading pit into which unlicensed curbside brokers flowed to buy and sell shares from each other with an abandon not seen in the auctions at the older New York Stock and Exchange Board. A financier reportedly said, “The battle of Bull Run makes the fortune of every man in Wall Street who is not a natural idiot.”⁵²

The turn of New York's economy perfectly suited Vanderbilt, the maker and driver of ships, the financier and rescuer of railroads. New construction and repairs kept his Simonson yard in Greenpoint filled to capacity. The Commodore's Allaire Works employed eight hundred men in constructing gun carriages for Monitor-style turrets; building engines for passenger steamers, navy frigates, an ironclad warship, and various gunboats; and repairing machinery on dozens of ships.⁵³

Newspaper editors and political malcontents talked of making Vanderbilt the secretary of the navy or treasury, a chorus that grew louder whenever the Union had a nautical or financial setback. But the Commodore stuck to his long-standing policy, as he once put it, “to mind my own business.” Perhaps he stuck to it a bit too closely. There was no sign of him when the income tax assessor of the new Internal Revenue Bureau made his rounds in 1862. At 38 Lafayette Place, the assessor found that William B. Astor owed taxes on three carriages, one billiard table, and 8,400 ounces of silver plate, in addition to an annual income of $617,472 (plus $64,850 in interest from federal bonds). At 10 Washington Place, he discovered nothing. The dry federal tax list reveals the bureaucratic equivalent of frustration; the assessor simply made up an income figure of $500,000 for Vanderbilt (on which he was taxed at the top rate of 5 percent), and added a 50 percent penalty, presumably for a failure to respond to inquiries. In fact, federal tax lists would prove to be a worthless source of information about him. His income increasingly consisted of stock dividends, which were taxed at the source. Even the most reliable individual income tax figure radically underreported his actual receipts.⁵⁴

Perhaps he was at the Fashion Course on Long Island when the tax man knocked on the door, for it was there that Vanderbilt indulged in the latest phase of his rivalry with Robert Bonner, editor of the Ledger, for ownership of the fastest trotting horses in New York. After one race at the course in 1862, “it was whispered that Mr. Bonner would give his mares a trial of one mile,” the Atlantic Monthly later reported, “and his appearance on the course in his road wagon, driving the well-known beauties, detained the whole assembled multitude.” Bonner and Vanderbilt's informal heats on Harlem Lane and Bloomingdale Road remained a topic of fascination in horse-mad New York, a city all the more crazed for racing as the wartime boom multiplied the men of leisure. Vanderbilt offered to bet $10,000 that his finest pair could beat Bonner's, but Bonner refused to bet as a matter of principle. Instead, he offered to stage a public time trial.

After the jockeys cleared off the track, the audience watched the Commodore walk onto the turf with a watch in hand. “When Mr. Bonner brought out his team there was a murmur of admiration,” the Atlantic Monthly wrote. He started his horses, Lady Palmer and Flatbush Maid, on a fast first mile round the track, then whipped them to an even faster second mile. As Vanderbilt kept time, his competitor drove the team to a speed of 2 minutes and 28¾ seconds per mile, and the crowd roared. “It was entirely unprecedented,” the Atlantic Monthly observed. “After learning the time in which his horses had trotted, Mr. Bonner publicly declared that, while it was a rule with him never to make a bet, he would present ten thousand dollars as a gift to any gentleman who owned a team, if he would drive them in the time just made.” Vanderbilt took his horses as seriously as he did his business; he would work very hard to earn that gift.⁵⁵

There was nothing really new about Vanderbilt's day on the Fashion Course, but it hinted at how he and the world around him were coming into closer alignment. On one hand, the old mercantile aristocracy continued to treat him as a worthy business partner but a bit of a vulgarian. His status as a social outsider among the elite has been exaggerated—his poor manners and ignorant speech even more so—yet there was undoubtedly an inner sanctum of patrician life in which he was still not welcome. In April 1860, for example, Strong had informed his diary that he had been asked to join a “committee of twenty which is hereafter to take charge of polite society regulate its interests, keep it pure.… It is to pass on the social grade of everybody, by ballot—one blackball excluding.” The other members included “Hamilton Fish, Anson Livingston, John Astor, William Schemerhorn, and others of the same sort”—but not, of course, Commodore Vanderbilt. “His wealth is unquestioned,” R. G. Dun & Co. had reported in 1860, but “his over-reaching disposition makes people shy of him.”⁵⁶

On the other hand, Vanderbilt socialized with another set that came rapidly to the fore in the volatile atmosphere of the war years: the aggressive, enterprising, risk-taking “fast men” of Wall Street. These men—Vanderbilt's circle—raced trotters, played whist at Saratoga, and bought and sold stocks with an avidity never seen before.⁵⁷ The cultural appeal of exclusivity would persist; in some eyes, the social strength of old family names only grew stronger, and new families sought to mingle and marry with them. Still, the economic and cultural reorientation of the Civil War undoubtedly created a sense that new growth was crowding out the old. Dixiecentric cotton merchants declined, and the geographical center of business shifted north. What historian Sven Beckert calls an emerging industrial bourgeoisie was not so much a new class, perhaps, as the triumph of a new outlook among the wealthy, one that had long existed but now came to the fore. It was an ease with the abstract economy, the intangible commerce of stocks and bonds and clearinghouse transactions, the impersonal corporations that began to supplant old family firms. This was the mind-set of the rising generation of rich New Yorkers. To them, the aged Commodore would be seen not as a barbarian but as a hero, an esteemed elder who saw far beyond the men of his time. In 1870, for example, when William W. Fowler published Ten Years in Wall Street, a memoir of his decade as a player on the stock market, he dedicated the book to Vanderbilt.⁵⁸

In 1862, the Commodore had not yet performed the miracles that would make him a messiah to many on Wall Street. Despite his past financial warfare, the new men who rushed into the “coalhole” where the Open Board met, who lurked in the offices of brokers on Broad Street or Exchange Place, hardly gave him a thought. A year would pass before he forced the entire financial community to rethink what a man could do with those stocks, bonds, and greenbacks with which their invisible world was built. In the meantime, the secretary of war called him back into the service of his country.

AT FIFTEEN MINUTES AFTER NINE in the morning on July 29, 1862, a sleek, bark-rigged sailing ship weighed anchor at the Laird shipyard in Birkenhead, England, and proceeded down the Mersey River on a trial trip. Various ladies and gentlemen, friends and relatives of the builders, enjoyed a party on deck to celebrate. It was a fine ship, 220 feet in length (210 at the keel), with two steam engines (horizontal, to remain belowdecks); a propeller that could be raised or lowered, depending on whether it was powered by steam or sail; and, curiously enough, a collapsible funnel. Stranger yet, it had been fitted for cannons, though none were currently on board. Strangest of all, it was called simply “hull No. 290.”

The “trial trip” and celebratory party were all part of a ruse. Thomas H. Dudley, the U.S. consul at nearby Liverpool, had spied on the 290 all through its construction, and learned that it was, in fact, a commerce-raiding cruiser being built for the Confederacy. Already he had taken legal steps to prevent delivery, forcing the South's naval agent in England, James D. Bulloch, to rush his ship to sea. The hastily planned trial run took place immediately after Bulloch received word that the British authorities were about to seize the vessel. “In the evening transferred our visitors to a steam tug,” wrote sailor George Townley Fullam in his journal. On board came the full complement of crewmen for a long cruise in search of Union ships. To evade British law, the 290 sailed to the Canary Islands to receive its armament of eight guns.

Its commander was Raphael Semmes. The dashing Semmes had served in the U.S. Navy decades before going over to the Confederacy, seemingly training all the while to be the perfect pirate. Already he had shown his prowess as captain of the CSS Sumter, which had seized eighteen merchantmen before the Union fleet trapped it in Gibraltar. Now, in his custom-built cruiser, he embarked on a far more destructive voyage. He also gave the 290 a new, more resonant name: Alabama.⁵⁹

ON JULY 17, 1862, PRESIDENT LINCOLN sent a formal message to Congress. “I have inadvertently omitted so long to inform you that in March last Mr. Cornelius Vanderbilt, of New York, gratuitously presented to the United States the ocean steamer ‘Vanderbilt,’ by many esteemed the finest merchant ship in the world,” he wrote.⁶⁰

Despite Welles's initial refusal to accept the great sidewheeler, many of the navy's senior officers now considered the Vanderbilt “the most formidable war vessel afloat in our waters,” as Harper's Weekly reported. On July 31, for example, General David Hunter wrote to Stanton from Port Royal on the Southern coast, “I have just had an interview with Flag-Officer [Samuel] DuPont, who considers it extremely important to the safety of his fleet that the Vanderbilt should be sent here immediately.” Admiral David D. Porter informed Congress after the war, “We never had a vessel that could run down a blockade-runner during the whole war, except the Vanderbilt and two others.” Its combination of speed and size made it formidable.⁶¹

During the Merrimack scare, the untrusting Stanton had learned to trust both the ship and its builder. Accordingly, new orders went forth from the War Department to the office at 5 Bowling Green. “The Vanderbilt is to be fitted out for cruising in the West Indies to run down the privateers that our Navy cannot catch,” Assistant Secretary of War Peter H. Watson wired the Commodore on September 3. “You are authorized to fit her up as well and as speedily as possible for the service.… Captain [Gustavus V.] Fox will correspond with you about fitting her out and arming her. The Navy are very anxious to obtain the aid of the Vanderbilt, for without it they cannot maintain the blockade against the Nashville, Ovieta, No. 290, and other fast vessels.”⁶²

Once again, the federal government gave this private individual great public responsibilities, as if the title “Commodore” were a formal rank. Once again, Vanderbilt carried out his duties swiftly and capably. “The Vanderbilt is now in first-rate condition,” Lieutenant C. H. Baldwin reported to Fox from New York on November 7. Baldwin, the ship's new commander, wanted to sail to the Caribbean, where he thought the Alabama (or 290, as Union officials persisted in calling it) might try to capture the Atlantic & Pacific steamers as they returned from Panama, laden with gold. He hoped to meet the rebel cruiser in battle, writing, “I pray I may have the opportunity of doing something worthy of so splendid a command.”⁶³

While the Vanderbilt was still refitting, the Commodore received a telegram from Stanton, asking him to come to Washington. He arrived late in the evening and went directly to Stanton's office in the War Department, where the secretary was still at his desk. As was the custom with each of these two men—who were getting to know each other quite well—they immediately proceeded to business. Stanton peered through his little round glasses and said something about appointing Vanderbilt to a position as quartermaster in New York. “We'll stop right there, Mr. Stanton,” the Commodore replied. “There is no position in this government that I want, and none that I will take; no place of emolument that I can take.” This brought the secretary to a halt. “He was delicate on that point,” Vanderbilt recalled. Given the late hour, Stanton said he would explain in the morning why he had called him to Washington.

At nine o'clock the next day, October 27, Vanderbilt returned to Stan-ton's office. “I have thought this thing over and made up my mind,” the secretary said. “Come and get into the carriage.” The two rode to see General Nathaniel P. Banks, a former speaker of the house turned unsuccessful general (against Confederate general Thomas T. “Stonewall” Jackson, against whom almost everyone was unsuccessful). Stanton spoke privately with Banks for a few minutes, then called in Vanderbilt. Stanton explained that Banks was to lead “a secret expedition, and no one else is to know it but us three.”

“No one will know it from me,” Vanderbilt replied. “I will assure you that.”

“I want you to assist General Banks in New York in fitting it out,” Stanton said. He asked Vanderbilt to charter steamships as transports and see that they were adequately prepared and supplied; he also briefly discussed with him a system of inspectors. (“His interviews were short,” Vanderbilt recalled, much to his liking.) Then Vanderbilt and Banks took the afternoon train to New York.⁶⁴

Banks went on to Boston to organize the new recruits who formed most of his expeditionary force, and Vanderbilt began to charter steam ships. He tried to deal directly with ship owners to avoid brokers, and bargained fiercely to keep the cost as low as possible. “I believe religiously that he has saved the government fifty percent in fitting out these vessels,” said Commodore George J. Van Brunt, the naval inspector assigned to the expedition. “My intercourse with Commodore Vanderbilt throughout this whole matter has been of the most pleasant kind; he was acting, as I thought, with great patriotism, in serving the government for nothing.”⁶⁵

Banks wired Vanderbilt from Boston that he would need transportation for fifteen thousand men, as well as a large number of horses. The Commodore chartered twenty-seven steamers, all that were available, and still he needed more. Transporting the horses was the real problem; sailing ships suited them best, he thought. “Then a man from down east came to me with a letter from General Banks,” Vanderbilt later testified before Congress. He was a shipbuilder from Richmond, Maine, named Thomas J. Southard. “When he gave me this letter of introduction from General Banks I talked with him, and I found he understood more about a horse-ship than I did, a heap more. He said he had been in it a good deal in his life, fitting up different horse-vessels for the West Indies, &c.” Vanderbilt thought to himself, “This is just the man I want.”

“Mr. Southard,” the Commodore said, “I want you to understand that I feel a strong interest in this controversy that we have got into, and I feel it to be a duty to my country to do it all the service I can. I am going to do it voluntarily, without any pay—how do you feel on that?”

Southard sat mute.

“Think it well over,” Vanderbilt added. “We ought to find patriotism enough in our country to do something for it without everybody making money out of the funds of the government.” Finally Southard agreed to take no pay. He assumed the duty of finding and fitting out sailing ships to carry the horses, chartering a total of thirty-five.⁶⁶

Unfortunately for the Commodore, Southard did not leave ship owners with the impression that he would take no compensation. The Mainer seems to have been a very smart man, in the old Yankee sense. He had family ties to ship chandlers and brokerages in New York, and—without ever explicitly demanding it—he implied that the ship owners must do business with his relatives, at a rate of 5 percent per charter. When Congress learned of the charges, Vanderbilt's handling of the Banks expedition took on the dimensions of a scandal—one that grew larger when one of the twenty-seven steamers, the Niagara, turned out to have rotten timbers which had been disguised by new planking that had fooled the inspectors. An impression formed that the entire fleet consisted of unseaworthy vessels chartered at exorbitant rates. The Senate convened an investigation, and a motion was made to censure Vanderbilt.

The motion died with the so-called scandal. Southard may have fooled the Commodore (and Banks, who recommended him) with his indirect commissions, but Congress concluded that the affair had been handled economically overall. As for the Niagara and two other ships with boiler troubles, such mishaps were to be expected in a large military expedition that was organized and launched in little more than a month.⁶⁷

Banks had no misgivings about Vanderbilt's conduct. On the afternoon of December 4, the general joined the Commodore, Mayor George Opdyke, and other prominent men in a celebratory excursion into New York Bay aboard a Treasury cutter, in tribute to Banks and his mysterious expedition. A toast was then made to Vanderbilt, who typically replied (according to the New York Tribune) that “he was not a speechifier; he would speak by proxy, through Gen. Banks.” Banks informed the distinguished guests “that Commodore Vanderbilt was the only man who knew where the expedition was going.” Vanderbilt kept the secret.⁶⁸

Banks, it turned out, would not make a grand attack on a Confederate stronghold. He was bound for New Orleans, which the Union navy had captured earlier. There his army would be able to cooperate with Union forces under General Grant, now driving south toward Vicksburg. The secrecy, of course, served to keep the rebels in doubt about where he might land. But Stanton may have thought to protect Banks from a serious danger, one he had asked Vanderbilt to help thwart. Somewhere at sea lurked Captain Raphael Semmes and the CSS Alabama.⁶⁹

ON THE MORNING OF DECEMBER 7, 1862, Captain Semmes went out on the deck of the Alabama and put his telescope to his eye. He looked every inch the pirate, in his long double-breasted coat with twin rows of bright brass buttons, his fierce moustache pointing to either side of his face like cannons run out of gunports on a man-of-war. He swept the horizon with his spyglass, looking for a wisp of smoke. Nothing. He turned and went back into his cabin, where he sat down to breakfast, “hopeless for that day of my California steamer,” he wrote in his memoirs, “and my millions of dollars in gold.”

For more than three months, the Alabama had burned or ransomed one Yankee merchantman after another. But what Semmes wanted more than anything else was to capture a Vanderbilt steamer on its way to New York, laden with California gold. The Confederate government would allow Semmes and crew to share in the prize; more important, such a capture might cripple the flow of gold to New York, just as specie shippers had warned the federal government at the start of the war. It would also saddle Vanderbilt's company with expensive claims for the losses.

“We had accurate time-tables of the arrivals and departures of the California steamers in the files of the New York papers that we had captured,” Semmes recalled. He loitered now in the windward passage east of Cuba, where he expected the iron sidewheeler Champion to pass on its way from Aspinwall to New York. Today, Semmes thought, would not be the day. The boatswain ordered the crew into their white frocks and trousers for Sunday services on deck, as the captain sipped coffee in his cabin.

“Suddenly the prolonged cry of ‘S-a-i-l h-o!’ came ringing, in a clear musical voice, from aloft,” Semmes wrote, “the look-out having at length descried a steamer.” George Fullam, a sailor on the Alabama, recorded the ensuing frenzy. “Steam was immediately got up, the propellor lowered, sails taken in and furled,” he wrote in his journal. “All hands called to quarters, the battery loaded with shell and run out.… Everybody in the best possible spirits and eager for a fray” Semmes knew that the steamships of the Atlantic & Pacific company were fast, so he hauled up a United States flag to lull suspicions until he got closer.⁷⁰

From the deck of the Vanderbilt steamer, Captain A. G. Jones peered through his own telescope at the approaching steam sloop as it emerged out of the sun glare. He could see it flew the Stars and Stripes, but he surveyed it with suspicion. Suddenly he exclaimed, “If that isn't an English rig, you may shoot me!” He was certain it was the English-built commerce raider, the Alabama. He ordered the engineer to put on all steam in an attempt to outrun the predator.⁷¹

Jones's ship was not the Champion, but the Ariel. The aging sidewheeler had steamed out of New York Harbor on December 1, bound for Aspinwall, and it carried no chests of gold. “The boat crowded to capacity with human beings, and some scarcely human,” wrote passenger George Willis Read. “The confusion and discomfort on board surpassed anything by far I have ever before experienced. The cooking was filthy beyond my powers of description. The smell and filth, with the rough sea, has kept me seasick most of the time.” Read was so disgusted that he interrupted the story of the Alabama's appearance to write that he ate only a baked potato that day. By the time he reached the deck, the Alabama had fired a blank cartridge and run up the rebel ensign.

“I knew it was the 290 at first sight,” Read added. “When I first saw her she was coming up behind us, a mile and a half in the rear, as near as I could guess. She is a splendid ship, and could sail around us with ease. The Capt. put on all steam, and hoped he could get off, but she [the Alabama] turned broadsides, and shot two heavy balls. I stood on deck, close to the aft, or back, mast. Saw the smoke rise, the balls leave the guns and come tumbling and whizzing towards me.” One round neatly severed the forward mast. At the urging of a marine officer on board, Jones surrendered.⁷²

“I was very anxious to destroy this ship,” Semmes wrote, “as she belonged to a Mr. Vanderbilt of New York, an old steamboat captain who had amassed a large fortune in trade, and was a bitter enemy of the South.” After Captain Jones went aboard the Alabama, Semmes told him that “Vanderbilt had given one of the finest steamers in the world to the Government with which to run him down, and he would destroy everything of his he fell in with,” according to the London Times. “Capt. Jones says the only ship that Semmes fears is the Vanderbilt,” the Chicago Tribunereported. “He [Semmes] made many inquiries regarding her speed and armament, but obtained no information whatever. He laughs at all the other ships we have.”

Semmes planned to burn the Ariel after landing the passengers in Jamaica, but reports of a yellow fever epidemic there caused him to change his mind. Instead, he had Jones sign a bond obliging Vanderbilt to pay $261,000 to the Confederacy thirty days after the United States extended it formal recognition. Then he let the steamship go. Not only had Semmes captured a Panama steamer headed in the wrong direction, his preoccupation with the Ariel caused him to miss the Champion, which arrived safely in New York with a million dollars in gold.⁷³

The fate of the Ariel, on the other hand, remained unknown in New York. Vanderbilt and the specie shippers waited with growing anxiety for its return from Panama. A report that it had encountered the Alabama reached the city but not word of the ultimate outcome. As the New York Timesreported, they were “prepared to mourn her.” Then, on December 28, it finally arrived unharmed, “and cut short the several obituaries that were in preparation for the occasion.”⁷⁴

“It strikes me that the rebel steamer Alabama is now looking for a homeward-bound California steamer,” Vanderbilt wrote to Welles the next day. “If the steamer Vanderbilt, or some other of sufficient speed, could be placed in the Caribbean Sea to convoy the steamers on leaving Aspinwall for two and one-half or three days up to the west end of Cuba, then returning to Aspinwall to be ready for the sailing of the next steamer, which is ten days apart, it would give ample security and would give her a better chance to fall in with the 290.” He said he would order his ships to sail by way of the western end of Cuba; he anticipated little trouble north of the island, given the presence of a U.S. blockading squadron in the Florida Keys. Welles agreed, and forwarded Vanderbilt's letter to the captain of the USS Connecticut with orders to carry out his instructions.⁷⁵

Semmes considered Vanderbilt not only a symbol of Union power and resolve, but a major force in his own right for the South's defeat. The rebel captain would not get a second chance at the Atlantic & Pacific liners, now that the Commodore had arranged for a naval convoy, but he did see a chance to strike at another enterprise organized by “the bitter enemy of the South.” From the newspapers he captured, he learned about Banks's expedition. The press did not know where it was headed, but Semmes sifted through the various guesses and came to a wise conclusion. He accordingly set his course for the Gulf of Mexico; with any luck, he would descend on the vulnerable transports and blow them out of the water, along with their thousands of Union troops and countless tons of arms.

On the evening of January 11, 1863, Semmes closed in on a line of ships off the Gulf Coast. It turned out not to be Banks's expedition, but a blockade squadron. Semmes had guessed wrong, sailing to Galveston, Texas, rather than the mouth of the Mississippi. One of the Union ships, a side-wheeler named Hatteras, pulled out of formation and gave chase. Semmes ordered the Alabama about and ran, firing all the while with a large gun mounted on a pivot at the stern, throwing eighty-five-pound explosive shells. In a battle of just fifteen minutes, the Alabama sank the Hatteras.

It was, in many respects, a lucky victory. Semmes's business was to avoid Northern warships, not fight them. And the hardest to avoid was the biggest and fastest, the one specially assigned to hunt him down. “He thinks the Vanderbilt much too heavy for him,” a South African newspaper reported on September 13, 1863. “In commenting upon the probable consequences of an encounter with the Vanderbilt, Captain Semmes spoke with much modesty about the power of his own ship.… His opinion is, that the Vanderbilthas much greater speed than the Alabama, and that it will be impossible for him to get away from her.” Referring to each ship's broadside, Semmes fretted that the Vanderbilt “threw twice my weight in metal.”

For a few days near the Cape of Good Hope, the Vanderbilt came close to catching the famous Confederate commerce raider—even passing close by in a fog bank—but the prey slipped away. In June 1864, the USS Kearsarge finally destroyed the Alabama in battle off the French port of Cherbourg. By then, the rebel cruiser had captured or destroyed sixty-four merchant ships, nearly crippling the U.S. commercial fleet.⁷⁶

VANDERBILT'S INSTRUCTIONS for convoying the Panama steamers marked a virtual end to his direct involvement in the Civil War. Cynicism would color later assessments of his efforts, growing out of the deep suspicion of nineteenth-century Americans—particularly newspaper editors—toward wealthy and powerful men. Cynicism, of course, always seems to be the most sophisticated position to take; yet it is also the laziest (along with hero-worship, its direct opposite).

An honest reading of the evidence shows a proud, prickly, and highly capable man of immense personal force—one who was also deeply patriotic. Welles's refusal to accept the Vanderbilt as a gift, or any of Vanderbilt's steamers at a fair purchase price, essentially forced the Commodore to take enormous sums of money from the federal government in charters fixed by brokers who had every interest in running up the rates. When given the chance, he served his country to the utmost while refusing any remuneration. The notion of a scandal surrounding the Banks expedition does not stand scrutiny. Just one ship out of the entire fleet slipped through inspection when it clearly should not have—and this at a time when Vanderbilt was chartering every steamer available in New York under a tight deadline. Southard exacted a commission (on the sailing ships only) through methods so indirect that Vanderbilt can hardly be blamed. Furthermore, Southard did his job, fitting out the vessels with the expertise expected of him. Vanderbilt's prompt and capable response to the Merrimack scare throws new light on this oft-told tale, for he played an important part in a strategic victory that usually is credited to the Monitor alone. And the gift of his eponymous steamship was an unprecedented act of patriotic charity, worth nearly $1 million.

Vanderbilt needs no special pleading. A man of his unfathomable wealth, obsessed with maintaining the power to defend himself against his enemies, could (and did) withstand a great deal of cynicism. But perhaps his elemental humanity requires a few words of defense. Derided by the most sneering of his contemporaries, he remains unreasonably fixed in the historical imagination as lacking all sensitivity, as an iron-hearted man of money. A man of money he most definitely was, often harsh and profane. But he possessed a tenderness that had become more and more visible in the years after the cruise of the North Star in 1853. Here we read a comment of how he and Sophia enjoyed their trip together to Washington; there we read Vanderbilt's truly warm letters to the family of his daughter-in-law, Ellen Williams Vanderbilt. Such signs would continue to accumulate.

This emotional inner life was certainly affected by the fate of that other member of his immediate family who was called to national service during the Civil War. Lieutenant George W. Vanderbilt commanded the inglorious recruiting station in Boston until April 1, 1862. On April 17, the regular army promoted him to the rank of captain, and named him aide-de-camp to General John C. Frémont, commander of the Mountain Department. But it seems unlikely that George ever saw duty beyond the Back Bay. He fell sick and went on a leave of absence even before his promotion. The illness—consumption, by one account—was clearly serious. At some point in 1862 or 1863, he traveled to Nice, France, to recover his health. Curiously, another George W. Vanderbilt from New York fought in the war, a doppelgänger to the Commodore's son, winning glory as a cavalry officer that the George of West Point and Washington Place would never earn.⁷⁷

It was a bitter twist for Vanderbilt, who dearly loved both his country and his youngest boy. He offered his son as a sacrifice to the nation in its hour of greatest need, and the nation took it. But the sacrifice was wasted, without purpose, without honor, leaving George only the pain and humiliation of a body that refused to function.

If Vanderbilt suffered as his son departed for Europe with a doubtful future, he also maintained that single-minded strength of will that had carried him to such heights. As the Civil War continued to rage in 1863, he went into battle to protect his private interests with a cunning and ferocity that would astonish the world—and seal his place in history.

*1 Merrimack was commonly spelled without the final “k.”

*2 Writers often mistakenly describe the gold premium as the price of gold per ounce, which only would be true if the weight of a gold dollar was 1/100 of an ounce. (It was, in fact, more than five times that amount.) Setting the price of gold by the ounce emerged far later. The distinction is important, for it speaks to the true nature of the gold market in the 1860s as a currency exchange.