Chapter Five

SOLE CONTROL

On March 8, 1878, the murmuring and rustling of a crowded courtroom in lower Manhattan suddenly fell still. Eighty-year-old Daniel Drew rose from his seat and cautiously ascended to the witness chair. He had been in court more than once that winter, his fragile bones and papery skin “wrapped up in sealskins and mufflers,” the press reported, lips tight and pinched as if they had been sewn shut. He sat slowly, settled his hands on the armrests, and “looked shrewdly at the lawyers with his small gray eyes.” He had been called to testify in what newspaper headlines called “THE GREAT WILL CONTEST.”

When prompted, he tersely admitted “that he knew Commodore Vanderbilt very well,” according to the New York Sun. He knew his sons, too, who now sat across the aisle from one another: William Henry Vanderbilt, plump and content, wearing a slight smile between the huge sideburns that clung to his cheeks like frightened monkeys, having “apparently inherited good health as well as nearly all the wealth of his father,” a reporter commented; and Cornelius Jeremiah Vanderbilt, “looking pale, thin, and meek,” disinherited, epileptic, and unhappy. “Occasionally Cornelius cast a furtive glance at William, but William never noticed Cornelius.”

Drew could have told stories of his secret cooperation with Vanderbilt over the decades, a partnership that had first blossomed at the end of the 1830s. But he did nothing of the sort. Yes, he told the court, he had had many conversations with Vanderbilt; unfortunately, he could not remember the substance of a single one of them. As the New York Times put it, “His testimony was of no importance.” Vanderbilt would have been proud. If there was one trait that had led him to trust Drew, a man notorious for self-interest, it was his silence. And in the aftermath of the Panic of 1837, there had been much to be silent about.¹

THE STONINGTON COULD CHANGE everything. On November 10, 1837, the first train had passed down its full fifty miles of track from Providence, where it connected to the Boston & Providence by ferry, to Stonington, Connecticut, a village seaport on Long Island Sound. Officially called the New York, Providence & Boston Railroad, and better known as the Stonington, it cut inside dreaded Point Judith, where steamboats ran into rough seas, which eliminated three hours and much seasickness from the trip between New York and Boston.

Soon after that first locomotive opened the route, Cornelius Vanderbilt investigated the line for himself. His nearly fatal accident four years earlier had not made him hostile to trains, as some later claimed; he keenly understood that control of traffic on Long Island Sound lay in the strategic balance between steamboats and railroads—and between rival railroads, as this and other lines neared completion. So he took a steamer to Stonington, boarded a train, and rode up the line to Providence. “There's nothing like it,” he told the line's chief engineer three years later. “The first time I ever traveled over the Stonington, I made up my mind.” It was the fastest route to Boston, potentially the key to the entire battle for the Sound.

And yet, the Stonington was a crippled giant. Its exorbitant construction costs “were a scandal,” according to one railroad historian. “Its fifty miles, through a far from forbidding territory, had taken $1,300,000 in stock and $1,300,000 in bonds.” Everyone who looked into its affairs could see that the interest on that staggering debt would weigh heavily for years to come.² Strategically situated, financially vulnerable, the Stonington gave Vanderbilt much to think about as he returned to New York.

Back at his office, now at 169 South Street, he found Daniel Allen and Lambert Wardell waiting for him with bills and correspondence. His brother Jacob needed to speak to him concerning his plan to burn coal in the Lexington in an attempt to save fuel costs and deck space; the engineer had no experience with coal and had to be fired.³ But perhaps most pressing of all was the problem of Billy.

Vanderbilt's oldest son, William, had now passed sixteen, the age when both Cornelius and Jacob had started out in life. Vanderbilt thought it was time for Billy (as he always called him) to make his own way. But the contrast between himself and his son distressed him. Vanderbilt radiated strength, and he grew more imperious every year. Wardell could not recollect a single instance of him admitting that he was wrong. “If he was interrupted when he was relating something,” noted Dr. Linsly “he would stop and never say another word—never resume the subject.” Allen later recalled, “He was always censorious towards people who differed with him.”

Billy could not have been more different, Allen explained. “We were acquainted in our boyhood days, and the intimacy increased after I married his sister,” he said. “He never in all that time made, to my knowledge, a single objection to anything his father suggested, either in business or in other matters. His father's will with him was absolute.” Billy's lack of spine aggravated Vanderbilt, who expected more of his blood. He often pressed his “delicate” son, calling him a blatherskite and a blockhead. When he did, Allen saw Billy's face collapse into “a peculiar sort of expression—an expression peculiar to him—a falling down of his jaw, a sorrowful look and a whining sort of noise.”⁴

After a brief education at the Columbia College grammar school, Billy had taken a job with a ship chandler, but the hard labor did not suit him. So Vanderbilt turned to Daniel Drew. This pious, deceitful, inn-keeping, cattle-dealing moneylender had adopted the People's Line name and competed against the Hudson River monopoly until he secured his own payoff in 1836. But Drew soon revived the line and assumed control of the monopoly himself. And that was why Vanderbilt and Drew grew so close, after so much enmity. They made an unwritten agreement to invest in the other's steamboats, precisely because neither had met a more dangerous opponent; giving a share to the other would make it in the interests of each to avoid competition.⁵

Vanderbilt wanted Billy to have a post in Drew's brokerage house. Together with Nelson Robinson and Eli Kelley (and later Kelley's son Robert), Drew worked at the center of Wall Street, trading stocks and bonds and serving as a “banknote shaver.” The firm facilitated longdistance financial transactions by buying notes and bills of exchange of far-removed banks and merchants at a discount, securing payment from the issuer or reselling them at a profit. It was an extremely risky business, especially in the aftermath of the panic. “The banks will not discount under present circumstances freely to good and safe men. They are afraid of each other,” declared the New York Courier and Enquirer. “Nearly every transaction is for cash.” Drew, Robinson, & Co. were willing, but they demanded a stiff premium for their services.

This kind of financial tightrope act would make a man out of Billy and teach him the value of money, his father seemed to think. Drew accepted the teenager as his clerk, but wanted something for himself: the use of the speedy new C. Vanderbilt for his People's Line on the Hudson, to run at the start of the season, in March 1838. Vanderbilt gladly let his secret partner use it, for he now took a share in the ownership of the People's Line as Drew established himself as the river's new monopolist. These former rivals were becoming close allies and friends. But Billy's fate was another matter entirely⁶

“I DID SUPPOSE THAT ALL NAVIGABLE WATERS were public highways, and open to all,” Vanderbilt declared; “therefore I do not complain at any gentlemen running their boat against those that I may see proper to run.” The signed statement appeared in the Boston Daily Advertiser and Patriot in July 1838. By now there was nothing surprising about his Jacksonian rhetoric. In this case, he was replying to advertisements “signed by the Directors of the Steam boat Huntress… [which] seem to aim at me and my boat, the Augusta,”he explained. “And why? because of my having chosen to put a boat on the route between Boston and Kennebec River [in Maine]. Of this newspaper controversy between the Directors of incorporated Steamboat Companies, and individual owners of other boats… I leave the public to judge.” Once again, he championed the lone individual against amalgamated wealth with special corporate charters.

But the rhetoric was wearing thin for those who glimpsed a self-serving opportunism beneath it. “We have had a great fuss here about Vanderbilt's boats,” wrote a college student from Maine. “Vanderbilt's undisguised end is to drive the Huntress off the line and control it entirely himself.” Wherever Vanderbilt had a chance to dominate a route, in fact, he tried to destroy his rivals.⁷

In April, for example, he had sat down with the president of the Stonington Railroad, Courtlandt Palmer, to offer his advice on how to defeat an opposition steamboat. Vanderbilt had put aside his competition on the Providence route to supply the railroad with the Lexington as a connecting boat, alongside one provided by his old foe, the Transportation Company. Now the Kingston, owned by a party in Boston, was undercutting the fare, and he wanted to fight them face-to-face. “Capt. Vanderbilt is in favor of breaking up the regular line and leaving at the same hour with the opposition,” Palmer wrote to William D. Lewis, senior officer of the Girard Bank in Philadelphia, a major holder of the company's stocks and bonds. “Capt. Vanderbilt, who has more experience than all of us united, says he is sure his plan is the right one for the interest of all concerned.”⁸

Vanderbilt agreed with Palmer. In his July newspaper appeal, he saluted himself for his “20 years experience in steamboats;—it has been my whole study, and I have built and owned some twenty and can say, without any intention of boasting, that not one life has ever been lost in any of the number.” (Only a steamboat owner in 1838 would make a point of pride out of never having killed anyone in the ordinary course of business.) It was getting difficult to think of this forty-four-year-old as an outsider.

Vanderbilt ruthlessly pursued his interests at the expense of his would-be partners. He even used his old enemy as a foil. When the Transportation Company canceled its contract with the Stonington at the end of April, he followed suit. Instead, he offered to lease the Lexington for $4,000 a month (plus the income from meals and the bar), the same deal offered by the Transportation Company for its steamer, the Narragansett. “His terms… are ruinous,” Palmer wrote to Lewis. “Vanderbilt is anxious to sell the Lexington, and offers her for 70,000 dolls.,” he added. “It is very desireable if we separate from the Transportation Co. to get Vanderbilt with us. If we do not take him, they will, & if we fight, we shall have to oppose both. But to pay 70,000 dolls. for the Lexington is buying him off at a price which is out of all reason.”

It was “exorbitant,” as Palmer put it, to demand $70,000 for a steamer that had cost $75,000 to build—before it had endured three years of battering and erosion on the rough, salty seas around Point Judith—especially now that steamers 25 percent larger had become the standard on the Sound. But Vanderbilt read his target well. Courtlandt Palmer was weak. This thirty-seven-year-old native of Stonington cringed and fawned before Lewis, the elite Philadelphia banker. He often made marvelously brave noises and then collapsed under pressure. When presented with the lease terms offered by Vanderbilt and the Transportation Company, he roared, “We had better however shut up the road than to accede to either proposal.” Eleven days later, on May 3, he squeaked, “I think it for our interest to close with them [Vanderbilt and the Transportation Company] on the [lease] terms proposed. By doing so we avoid a collision.”⁹ No man afraid of a collision could withstand Vanderbilt.

The Stonington sank ever lower. During the summer, Vanderbilt's old agent, John W. Richmond, ran an opposition boat at reduced prices. “She is a sure scourge to us, causing us to lose heavily,” Palmer noted. In October, Palmer negotiated a disastrous new contract with the Transportation Company, giving it 70 percent of the through fare between New York and Boston. Meanwhile the line issued more bonds, going deeper into debt.

In the middle of November, with the leasing agreement terminated, Vanderbilt approached Robert Schuyler, the president of the Transportation Company. If the company did not buy the Lexington, he declared, he would run it to Providence at a fare of $1. Even adding the cost of a ticket on the Boston & Providence Railroad, this would allow travelers to go from New York to Boston for far less than the $5 (or more) that the Stonington demanded. “Our losses will probably be $30,000 in consequence,” Palmer fretted, “while the Trans. Co. would lose twice that or more.” He and Schuyler immediately opened negotiations. All the while turmoil reigned within the Stonington, as stockholders angrily protested the extraordinary debt that would soon place the corporation in the bondholders' hands (as they held a mortgage on the railroad's physical stock of rails, locomotives, cars, and depots).

At the beginning of January, the Transportation Company agreed to pay $60,000 for the Lexington, and the Stonington added a $10,000 bonus, thus matching the original demand. No one had any illusions about the reason for the purchase. They were “buying off Vanderbilt,” wrote banker Joseph Cowperthwait, a Stonington trustee. As Palmer put it, they were paying for the Lexington “to get rid of her as an opposition boat.” He estimated her worth at $30,000, making a bribe, or “bonus,” of some $40,000. “We found it unprofitable [to fight Vanderbilt],” explained Captain William Comstock, the Transportation Company's general agent, “and concluded that it was better to be at peace than at war, on any terms.”¹⁰

Such was Vanderbilt's reputation that he not only forced his enemies to buy his too-small boat, but extracted $10,000 from a railroad even as it went bankrupt—and all without a single trip at a reduced fare. But a reputation is a slippery thing. “Before paying it, I sent for Mr. Vanderbilt and received from him a most positive pledge that he would never again in any way interfere with the Line,” Palmer wrote. “I asked it in writing but this he declined to give, remarking that I knew his verbal promise could be fully relied on.” The hard-bitten Captain Comstock, on the other hand, had “no confidence in him,” as he told Schuyler. He was sure that, before long, Vanderbilt would be back¹¹

ON THE WARM SUNDAY AFTERNOON of September 2, 1838, a very angry man with the very peculiar name of Oroondates Mauran stepped aboard the Samson, a steam ferryboat as large and powerful as its namesake. The fare collector greeted him respectfully, perhaps with the salutation “Commodore.” The Samson belonged to the Richmond Turnpike Company, and Mauran was its president and largest stockholder, as he had been for the previous seven years. “We always understood him to be the general agent as well as the President,” the collector explained. “That is what we call ‘Commodore.’ His word was will there.”¹²

Shrewd and tough, Mauran was a merchant with a long history at sea. Twenty years earlier, when Vanderbilt first had met Vice President Daniel D. Tompkins, the founder of the Richmond Turnpike Company, Mauran had owned a three-masted ship, the Maria Caroline, and he still invested heavily in the Havana trade. But most of his money was in the Richmond Turnpike corporation, which ran a ferry between Staten Island and Manhattan's Whitehall Slip—as it had when John De Forest took command of the Nautilus, the first steam ferry between the two islands, in 1817. Now he was having trouble with another of Vanderbilt's relatives: his cousin Oliver Vanderbilt.

Mauran stood on the deck of the Samson as it floated at its Staten Island dock, and gave some last-minute instructions to its master, Captain Braisted. He wanted the boat to get an early start that day. Usually Oliver took the lead with his own ferryboat, the Wave, and delighted in taunting the Samson. “She generally started first and she would often stop opposite our dock and ring her bell to coax us off,” explained Braisted's son. “We would sometimes wait 15 minutes to let the Wave get off.”

The harassment enraged Mauran—but then everything about Oliver Vanderbilt enraged him. Oliver had once been a Richmond Turnpike ferry captain and shareholder; on October 19, 1835, he had sold his stock with the explicit understanding that he would not compete against the corporation. “He meant to live on a farm,” Cornelius remembered him saying, “and have nothing more to do with a life on the water on account of his health.” Instead, Oliver had launched the Wave and began carrying passengers for sixpence, half the company's shilling fare. The rivalry had rapidly escalated to much more than the typical racing, as the boats crowded and nudged each other. “It was a common occurrence for the boats to come together 3 or 4 times a day,” one man observed.

The collisions had grown more dangerous. In late August, just three or four days before this particular Sunday afternoon, Captain Braisted had come down to the deck to tell Mauran that the Wave was “crowding him out of his course.… She was a much smarter boat than the Samson.”Mauran had glared back at him. “If she ever does that again,” he had barked, “damn her, run into her, sink her.”

On this day, September 2, Braisted took the Samson out with a good head start, but the Wave came up fast on her starboard side. Belowdecks, the bartender heard an enormous crack; he ran out and discovered that Oliver had nosed his boat against the side of the Samson, buckling wood for twelve feet behind the starboard paddlewheel. “This made the captain of the Samson much excited,” he blandly observed.

On the return trip from Whitehall, Braisted angrily ordered his engineer to put on all the steam he could. As the Wave passed Governors Island, passenger Stephen W. West looked over at the Samson's pilothouse. “The Samson was about twice her length ahead of the Wave when I noticed the Captain throw her wheel around,” he recalled, “and the Samson run directly into the Wave.” The Wave was packed with passengers, including numerous women and children, who began screaming in terror as wood splintered in the collision. Only a last-minute maneuver by Oliver Vanderbilt prevented the blow from striking square amidships and likely sinking his boat. “The Samson turned round again and came for another attack,” West added. “I saw he was determined to destroy the boat I was in.… I told the captain of the Samson he would have company in the wheelhouse if he came near enough to us. Myself and some 15 or 20 others made preparations to attack. We got hold of sticks of wood and what loose things we could, 15 or 20 of us to get aboard of her.”

The Samson sheered off before West and his boarding party could capture it, but on landing at Staten Island the Wave's frenzied passengers stormed the ferry house of the Richmond Turnpike Company. “Mr. Mau-ran was on the dock when the people were destroying the property and he was much excited as were also the people,” declared the fare collector, “and I think if he had gone 10 feet further he would have been killed or thrown into the water.”

“Immediately after landing,” West said, “when on the wharf at Staten Island, I asked Mr. Mauran whether he did not think it was unpardonable to allow his boat to run into and try to sink the Wave, when so many people were on board of her.” Mauran replied, “Damn him I wish he had sunk him.” West had had his young son aboard the Wave, and Mauran's heartlessness infuriated him.¹³

The steamboat trade had always been the most aggressively competitive business in America. Its fare wars, populist advertising, and highspeed racing embodied the nation's individualistic, unregulated society. It also embodied its mechanized, unregulated violence, with its deadly boiler explosions and reckless desperation to defeat the opposition. “ANOTHER, AND YET ANOTHER,” declared one newspaper in late 1837. “It is hardly worthwhile to attempt keeping any account of the steamboat disasters which are daily and almost hourly occurring, for no one seems to feel any interest in the subject.” Conservative Whigs such as Philip Hone found the mayhem “shocking in the extreme, and a stigma on our country. We have become the most careless, reckless, headlong people on the face of the earth,” he wrote. “‘Go ahead’ is our maxim and password; and we do go ahead with a vengeance, regardless of consequences and indifferent about the value of human life.” It was the Democratic newspapers that made a point of praising “the incalculable benefits of competition” which helped “the people at large, by causing great and permanent reductions of fare on several of the most important routes.” The Whig press, on the other hand, warned that it could go too far, and lead not only to bloodshed, but to “the utter ruin of one or both the competitors. When this occurs, the community must of course suffer in turn.”

Yet the Whigs were coming to terms with competition. In 1838, they won control of New York's state government under the leadership of a triumvirate composed of Governor William H. Seward, newspaper editor Horace Greeley, and Albany party boss Thurlow Weed, who sought to wed active government with equality of opportunity. In an Independence Day address in 1839, Seward attacked special privileges, saying it was the Whigs' mission to “break the control of the few over the many, extend the largest liberty to the greatest number.” In other words, government would aid the enterprising but not protect the elite. Even the Whiggish Niles' Register admitted, rather reluctantly, that competition “has its advantages. Community is generally benefitted—monopoly is suppressed, and the utmost perfection and economy is insured.”¹⁴

Cornelius Vanderbilt, on the other hand, took a step in the other direction. He heard of the disastrous ramming of the Wave almost immediately, for he maintained close ties to Staten Island, where his mother still lived and where he had many friends and business associates. He learned that Mauran's fellow stockholders—principally Dr. John S. Westervelt, a son-in-law of Daniel Tompkins—wanted out. Oliver's opposition and the terrible publicity had destroyed the value of their shares. Vanderbilt snapped them up, fully half of the total, “upon the express condition that he should have the sole control and management,” according to Oliver.

Sole control. It would be a recurring theme in Vanderbilt's life. Always dominating, he increasingly lost interest in investment unless he had power over what was done with his money. Sole control. Oliver differentiated it from “management,” and for good reason. Cornelius wanted independence, not only from Mauran and the other directors, but from legal obligations and political authorities. The Richmond Turnpike Company's special charter was a relic of mercantilism, requiring it to provide ferry service at uneconomical times—a requirement Oliver, as an independent competitor, did not have to meet. Cornelius chose to ignore the mandate. “Cornelius Vanderbilt has frequently given out that he intends running the boats upon said ferry with the sole view of profit,” Oliver complained, “and without regard to the rights or convenience of passengers.”

And what was more convenient for passengers than competition? Oliver had cut the fare in half and doubled service. Cornelius got a bargain on the stock because of that competition, which he now meant to snuff out. On July 2, 1839, he filed suit against his cousin. The Richmond Turnpike Company owned the Staten Island property where Oliver kept his dock, he argued, and had exclusive rights to the “bridge, ferry house, and bulkhead” on Whitehall Slip that he also used. The company had “accepted and took the said lease [at Whitehall] with full confidence that no person was to be allowed to interfere with their right, immunities, & privileges.” In short, “the greatest practical anti-monopolist in the country” claimed a legal monopoly¹⁵

WHEN VANDERBILT STRODE through the portico, he passed between six fluted columns into the interior of his new mansion. Workmen crisscrossed the floor carrying mantels of Egyptian marble and balustrades of solid mahogany on their shoulders. A special crew of craftsmen from England hammered away at a grand spiral staircase recessed into an oval well, spinning upward forty feet to the top floor. The hustle resembled the bustle around Bellona Hall fifteen years earlier, but this grand house was a world away from that humble inn, even if it was just on the other side of Staten Island from the Raritan River. Here was French plate glass, rosewood parlor doors with silver knobs, and a stained-glass skylight at the top of the stairwell. Another English artisan placed a sheet of glass, painted with the steamboat Cleopatra, over the front door. The captain was building a home fit for a commodore.

He had been a very young man when he purchased the property from his father. “Cornele's lot,” the locals had called it. His mother lived just a three-minute walk south of here. When he looked out the door of the house, he gazed out atop a hill that gave him a commanding view of the bay, over the terraced landscape and ferry dock below him.¹⁶ “It is not possible to conceive a more extended or beautiful prospect,” wrote Philip Hone that summer of 1839, after visiting Vanderbilt's neighbors, the Anthons. “Situated on the summit of the hill back of the Quarantine ground [the state hospital for sick immigrants], it commands a view of the ocean and bay, with all that enters or leaves the port, Long Island, the city North River, the Jersey shore, the Kills, Newark, and Elizabeth.” The island was becoming a fashionable summer destination, and even Hone toyed with the “plan of having a seat on Staten Island.”¹⁷

Francis Grund, a wry observer of New York's social elite, took the ferry that same season. “A fine brass band was stationed on deck,” he wrote, “and the company consisted of a great number of pretty women with their attendant swains, who thus early escaped from the heat of the city in order to return to it at shopping-time.” These visitors went to the Brighton Pavilion, which “offers really a fine and healthy retreat from the noise and dirt of New York,” thought Grund. “The busy bar-keeper was preparing ice-punch, mint-juleps, port and madeira sangarie, apple-toddy, gin-sling, &c. with a celerity of motion of which I had heretofore scarcely seen an example. This man evidently understood the value of time, and was fast rising into respectability; for he was making money more quickly than the ‘smartest’ broker in Wall street.”¹⁸

Grund's sly joke applied to the captain overseeing construction of his mansion farther down Staten Island, only in his case it wasn't funny. In the midst of economic hardship, when Hone found “money uncome-at-able, and confidence at an end,” the uneducated Vanderbilt rapidly rose in wealth, and so too in social stature, if more slowly. When Charles Dickens visited the United States in 1842, he marveled at the American “love of ‘smart’ dealing, which gilds over many a swindle and gross breach of trust.” He often pointed out a man who was getting rich “by the most infamous and odious means,” yet was “tolerated and abetted” by the public. He always asked, “In the name of wonder, then, what is his merit?” Back came the invariable reply: “Well, sir, he is a smart man.”¹⁹

Vanderbilt, however, won respect for more than simply being smart. Americans, and Democrats in particular, distinguished between “stockjobbing” speculators, whom they saw as little more than gamblers or tricksters, and “enterprising” men, who built businesses and created wealth. In 1842, editor Moses Beach added Vanderbilt to his annual list of “the Wealthy Citizens of New York City” alongside Philip Hone, Oroondates Mauran, Daniel Drew, and John Jacob Astor. Beach curtly described Drew as “a shrewd, money making man,” but he lavished praise on Vanderbilt as a productive entrepreneur. “Cornelius has evinced more energy and ‘go aheaditiveness’ in building and driving steamboats, and other projects, than ever one single Dutchman possessed,” he exclaimed. “Put on the coals and steam and flare up for Stonington!”²⁰

When the mansion was completed in 1840, Vanderbilt moved his large family there, onto his ancestral lands, close to his mother, hard by the dock served by the ferry he now controlled. He now enjoyed spacious comfort commensurate with his wealth. But the newly fashionable status of a country seat on Staten Island certainly appealed to him as well, as he began to mingle with the rich and influential. “Vanderbilt… is now at Saratoga,” wrote Courtlandt Palmer one August around this time; by habituating the little resort town of Saratoga Springs, just north of Albany Vanderbilt moved in society's loftiest circles. “All the world is here,” wrote Hone in Saratoga, referring to perhaps two thousand of the nation's elite, “politicians and dandies; cabinet ministers and ministers of the gospel; officeholders and officeseekers; humbuggers and humbugged; fortune-hunters and hunters of woodcock; anxious mothers and lovely daughters.”²¹

On his Staten Island estate, the self-made, would-be dynast gathered his family about him rather like a royal court. He built a three-story Tudor house just south of this property for Ethelinda and her husband.²² Vanderbilt's primary attorney was William K. Thorn, newly married to his daughter Emily. And his nephew, Jeremiah Simonson, worked for him as well.

And then there was Vanderbilt's younger brother (and neighbor) Jacob, who maintained a powerful bond with Cornelius even as he pursued his own business interests. After the Transportation Company purchased the Lexington, for example, Jacob continued to serve as its captain, faithfully carrying out repairs and reconstruction under the orders of Captain Comstock. Though he labored in his older brother's shadow, Jacob won renown on Long Island Sound. In December 1837, a New Englander wrote (using phrenological jargon) that Jacob, “as it is pretty well understood, has the ‘go ahead’ bump pretty strongly developed.” That month he brought the Lexington safely through a ferocious storm that snapped the rope controlling the rudder.²³ He became famous for his “unsurpassed energy and decision of character, wonderful quickness, and reach of judgment,” as the monthly Ladies' Companion declared, “and imperturbable calmness and resolution in the moment of danger.” Had he not taken ill on January 13, 1840, the editors reflected, “many lives might have been saved.”

At two o'clock on the afternoon of January 15, wrote Philip Hone, “the city was thrown into an awful state of consternation and alarm.” Chester Hilliard of Norwich had arrived with terrible news: the Lexington had been destroyed in a horrific fire two nights before on its way from New York to Stonington. Cotton bales piled around the smokestack had caught fire; the crew had fumbled its attempts to fight the blaze, and had swamped the lifeboats by lowering them while the steamer was still at full speed. Hilliard and another man climbed onto a floating cotton bale; Hilliard strapped himself to it, but his companion did not. After a night adrift in the freezing seas, only Hilliard remained on the bale. Just four of some 125 men, women, and children survived. At least $20,000 in gold and silver disappeared into the Sound. It was, as the newspapers put it, an “appalling calamity.”

Perversely, the horrific accident may have enhanced Cornelius Vanderbilt's stature. The press reprinted the testimony at the coroner's inquest, held a week after the tragedy. The public read of how Vanderbilt had personally designed the boat, how it had been built with the best materials, how even his enemies had admired its strength and speed. Charles O. Handy, the new president of the Transportation Company (now incorporated as the New Jersey Steam Navigation Company), and Captain Com-stock hinted that Vanderbilt had coerced the company into buying it.²⁴

Fear and admiration, admiration and fear—always they arose in pairs, a spiral helix of emotion, when other businessmen spoke of him. “I have seen Vanderbilt today,” wrote R. M. Whitney of the Stonington on November 12, 1840. “I had much rather have the opposition of the Trans. Co. to contend with than his.… He and Mauran are determined, persevering men who will carry through all they undertake.” (Whitney obviously believed, perhaps correctly, that Vanderbilt's partnership with Mauran went beyond the Richmond Turnpike Company.) Courtlandt Palmer reflected, “He is so powerful (worth at least half a million of dollars) that we do not wish to war with him if we can possibly avoid it.” The railroad's chief engineer, William Gibbs McNeill, echoed these sentiments in an emphatic assessment he wrote after a lengthy interview with Vanderbilt: “Capt. V. has risen by his merits—a very enterprising, indefatigable, intelligent (of his business) man. His frequent practice—to build boats—run opposition—make money despite of opposition—then sell at a premium to leave the route. Possible that he may (in the count of not being connected with us) serve us the same way.”

McNeill was a graduate of the two great schools of America's early railway engineers, West Point and the Baltimore & Ohio Railroad, and was hardly a soft touch. Yet his respect for Vanderbilt verged on awe. He concluded, “I confess if we are to be opposed I'd sooner have him with us, than against us.”²⁵

Vanderbilt was a man defined by enterprise, but he had handed his son over to Daniel Drew, the furtive master of speculation and subterfuge. As one of Drew's clerks, Billy entered the eternal dusk of Wall Street, where the dim light perfectly suited his boss. In New York's early, unregulated stock market, insider trading was the norm. Courtlandt Palmer and William D. Lewis, for example, often wrote about plans for an “operation in our stock,” as they tried to profit through their access to inside information, or attempted to manipulate the share price up or down.

At one point the refined Lewis built a steamer, the Eureka, for the Stonington line. In a Vanderbiltesque maneuver, its captain tried to extort money from the Hudson River monopoly by threatening to run it to Albany. “Under the circumstances,” Palmer advised Lewis, “perhaps it would be judicious for you to [put] the stock you have bought in the name of someone else, that you are not to be known as an owner of the Eureka.” Unfortunately for them, the leading figure in the monopoly was now Drew, who saw through the deceit and sent a stark warning to the Stonington men. Soon Palmer glumly reported that the Eureka's captain had been “tampered with” by Drew and his partners, adding, “he has been in their pay”²⁶

“All visible objects, man, are but as pasteboard masks,” Captain Ahab declares in Moby-Dick. “Some unknown but still reasoning thing puts forth the mouldings of its features from behind the unreasoning mask.” Herman Melville's sense of the world as untrustworthy, as a shroud over a deeper reality captured something essential about this time and place. For such was the world that swallowed Billy Vanderbilt: a netherworld populated by those artificial persons called corporations that masked the real persons behind them; by paper money, that masked real gold and silver; by whispered rumors, that masked the manipulations of self-serving men. Paper currency, the North American Review piously intoned, was “a consequence of the increased confidence of man in his fellow man;” but it could also be seen as a demand for confidence that raised suspicions all the higher. Melville's later novel The Confidence-Man consists largely of eloquent appeals for trust in others, appeals made by the trickster of the title in the service of fraud. Legitimate banknotes were rarely accepted at face value, for fear that they could not be redeemed for the full amount of specie promised, and thousands of counterfeit varieties circulated. In The Confidence-Man, a hapless fellow tries to use a counterfeit detector (a list of identifying marks on legitimate bills) that itself is counterfeit. By the 1840s, it seemed that these mysterious abstractions, these false fronts, these outright lies, had layered over the direct, natural economy of people and things that Americans had always known. It is telling that Melville's talisman for the white whale, the ultimate, unreachable reality is a gold coin.²⁷

“Delicate” was the word that later popped up whenever Billy's youth was mentioned—but life in Wall Street's shadow world required iron nerve. It would be said that he worked hard, too hard, as he married Maria Kissam, daughter of a prominent Brooklyn minister, and settled into an East Broadway house (most likely rented from his own father). But the daily risks, the tensions, the double-dealing weighed on him.²⁸

Then came the Indiana bonds. Like many states (including New York), Indiana embarked on a “Mammoth System” of public works during these years of depression. It issued millions of dollars' worth of bonds to finance canals, roads, railroads, and other “internal improvements.” Many of these securities were entrusted to Commissioner Milton Stapp to sell in London. Unfortunately, the printing of the bonds did not meet the standards of the London market; new bonds were issued, and Stapp was directed to cancel the old ones. Instead, he met with Drew and Robinson in late 1840. Drew's firm sold both the old and the new bonds in New York in January 1841, bringing a windfall of $134,000. A new commissioner, sent to investigate, stormed into the office and demanded an accounting. Robinson flatly refused to provide one, and Indiana filed suit. For the state government, it was part of a financial catastrophe. For the nation, it was part of a growing disgust with public works that failed to produce public benefits—a disgust that would open the way for Drew, Vanderbilt, and others to build fortunes in railroads. And for Billy, it was a shocking education in the underhanded ways of Wall Street.²⁹

Billy suddenly quit Drew's firm. “He was a delicate young man,” the New York Times would say, “and the hard work he had done proved too much for his constitution.” More likely, he could not bear the stress of risky, even illegal maneuvers. Cornelius grudgingly purchased a farm for his broken son and his new wife near the village of New Dorp on Staten Island, not far from his own palatial estate. “Billy is good for nothing but to stay on the farm,” he told Hosea Birdsall, one of his employees. As Birdsall recalled, “He said he would try to make a good farmer of him.”³⁰

Meanwhile, Vanderbilt returned to the war for control of Long Island Sound.

“THE STONINGTON IS THE key,” wrote William Gibbs McNeill on November 13, 1840. The line's chief engineer never wavered in his belief that the railroad must become the primary artery of transportation between New York and Boston. But it faced a grave problem. “The company being embarrassed—involved in debt—with an impaired credit,” he wrote in an official report, “could not procure steamboats of their own, and of course were dependent on those who did own them. To their terms we were compelled to submit, and we did submit.” The Transportation Company had the upper hand. To change that, McNeill wanted to forge an alliance with Vanderbilt.³¹

On November 13, Vanderbilt strode into McNeill's rooms in New York, where the sick engineer was confined to his bed. A daguerreotype of Vanderbilt from this time calls to mind a description of a typical wealthy New Yorker by Francis Grund in 1839:

His stature was straight and erect; his neck… was, by the aid of a black cravat, reduced to a still narrower compass; and his hat was sunk down his neck so as to expose half his forehead. His frock-coat… was buttoned up to the chin, and yet of such diminutive dimensions as scarcely to cover any one part of his body. His trowsers were of the same tight fit as his coat, and the heels of his boots added at least an inch and a half to his natural height.

But Vanderbilt was no dandy A viscerally physical presence, he was worth as much—and probably far more—than the entire Transportation Company (capitalized at $500,000). Even as he took control of the Richmond Turnpike Company, he had bought out the New Haven Steamboat Company and added the powerful C. Vanderbilt to his Southern coastal line. McNeill spoke bluntly to him, and made the only contemporary verbatim record of a conversation from the first fifty years of Vanderbilt's life.³²

“Captain Vanderbilt,” he began, “my usage and preference is, in a matter like the present, to be explicit and unreserved. You are aware of our present connection [with the Transportation Company] and the reasons its continuance is to be preferred.… They have suitable boats… and although it would be a loss to them, yet if not employed by us they as probably be run in opposition to us.… You know them?”

“Yes.”

“We are in negotiation now and we await their terms. You have read my report?”

“Yes.”

“Then you know my views,” McNeill concluded. “What are yours?”

More than ten years earlier, Frances Trollope had observed the shrewdness of the Yankee businessman in conversation—his gift for indirection, his ability to avoid giving away any useful information—and Vanderbilt now displayed his talent at that fine art. After praising the railroad, he haltingly remarked, “To be candid with you, as you've been with me—I—couldn't—be in anything—with Mr. Palmer for president.”

“Well, suppose you had it all your own way—whom you please for president and directors—O. Mauran? Or anyone else?”

“Anybody else and what board you please—anybody but him.” Vanderbilt had nothing but contempt for the spineless, technically ignorant Palmer.

“Well,” answered McNeill, with rising frustration, “suppose that settled—your terms?”

“Why—if the route were open I wouldn't ask a better business than one-half,” Vanderbilt replied, meaning half the through fare between New York and Boston.

“That is my idea—but the route is not open,” McNeill said, referring to the Stonington's ties to the Transportation Company. But he wanted to know if Vanderbilt planned on launching a rate-cutting war on the route. “By the bye,” he asked, “do you think of coming on it anyhow?”

“Have not made up my mind.”

Blunted in this probe, McNeill took another tack. “Would you propose to throw in your boats for stock—we have the privilege of owning boats under a very advantageous charter.” In other words, would Vanderbilt consider selling the railroad some steamboats in return for shares in the Stonington, and a post as a director?

“I've heard of that, and think it might be made to answer.” Vanderbilt warmed to the topic, pondering aloud how the railroad might run if he joined its management. “It might take one—or two—years to do any opposition up,” he mused, using the slang “do up” for destroy. “Steamboats would both lose.”

“Yes, and we pay expenses only.”

“You'd do more than that,” Vanderbilt snorted. A master of economy, he had a reputation for making a profit even in a rate war. “And—after two years—would have it all our own way. I shouldn't care to make money in that time. I know the route—there's nothing like it.”

“Well—we agree in that—but as you can understand me—I should be glad at your convenience to know what you will do,” McNeill stated.

The conversation displayed Vanderbilt's peculiar combination of wiliness and directness, of intense personal dislikes (in this case for Palmer) and sly concealment of his intentions. It also included one revealing exchange that McNeill mistakenly dismissed as mere bravado. Frustrated with Vanderbilt's refusal to commit himself, he asked at one point, “What do you think would be to your interest to offer?”

“If I owned the road,” Vanderbilt answered, “I'd know how to make it profitable.”

“Oh!” McNeill exclaimed sarcastically. “I suppose you'd own the boats too.”

“Yes,” Vanderbilt replied, and said nothing more about it. McNeill paid no attention. He could not take seriously the idea of one man buying control of a railroad. The Stonington was some fifty miles long, worth millions in fixed capital. It was also “embarrassed” by debt, as he put it, and in the hands of its creditors, the Philadelphia banks. Vanderbilt as master of his railroad? The idea was ridiculous.³³