W H Vanderbilt
CHAPTER XXXV.
WILLIAM H. VANDERBILT.
A Builder Instead of a Destroyer of Public Values.—His Respect for Public Opinion on the Subject of Monopolies.—His First Experience in Railroad Management.—How he Improved the Harlem Railroad Property.—His Great Executive Power Manifested in Every Stage of Advance Until he Becomes President of the Vanderbilt Consolidated System.—An Indefatigable Worker.—His Habit of Scrutinizing Every Detail.—His Prudent Action in the Great Strike of 1877, and its Good Results.—Settled all Misunderstandings by Peace and Arbitration.—Makes Princely Presents to his Sisters.—The Singular Gratitude of a Brother-in-Law.—How he Compromises by a Gift of a Million with Young Corneel.—Gladstone’s Idea of the Vanderbilt Fortune.—Interview of Chauncey M. Depew with the G. O. M. on the Subject.—The Great Vanderbilt Mansion and the Celebrated Ball.—The Immense Picture Gallery.—Mr. Vanderbilt Visits Some of the Famous Artists.—His Love of Fast Horses.—A Patron of Public Institutions.—His Gift to the Waiter Students.—While Sensitive to Public Opinion, has no Fear of Threats or Blackmailers.-“The Public be Damned.”—Explanation of the Rash Expression.—The Purchase of “Nickel Plate.”—His Declining Health and Last Days.—His Will and Wise Method of Distributing 200 Millions.—Effects of this Colossal Fortune on Public Sentiment.
In treating of the family in the order of descent, I shall now make a brief survey of the life of William H. Vanderbilt, especially in its relation to Wall Street affairs and the management of his great railroad system, the two being closely connected. William H. Vanderbilt was not much of a speculator in the Wall Street sense of the term. He was more of an investor than a speculator, and his investments had always a healthy effect upon the market. Unlike Woerishoffer and others of that ilk, he built up instead of pulling down values, but was at the same time careful to avoid the error of inflation. He paid due deference to public opinion also, in striving to allay its alarm in regard to the dangerous overgrowth of monopolies. A grand illustration of this was seen in the sale of the large block of New York Central. His first experience in railroad matters was in connection with the Staten Island Railroad, thirteen miles in length. The road had been mismanaged and was deeply in debt, and became bankrupt. As he and his father had considerable interest in the road William H. was appointed receiver. It seems this was done secretly at the suggestion of the Commodore, who wanted to discover by this experiment if his son had any capacity for railroad management. The receivership of the Staten Island road was crowned with signal success. In two years the entire indebtedness of the road was paid, and the stock, which had been worthless, rose to 175. William H. Vanderbilt was then elected President of the road. It was at this time, it is said, that the Commodore began to correct his judgment regarding the “executive ability of William H.,” and the latter relaxed no effort to please his exacting father in everything, taking all his abuse without complaint or anger. After the Commodore secured control of the Harlem road, which was his first great railroad venture, he made William H. Vice-President. As a co-worker with his father the latter further demonstrated his capacity for railroad management, and Harlem stock, which had been down to nearly nothing, in a few years became one of the most valuable railroad properties in the country. So, it is a fact, although not generally known, that William H. Vanderbilt had proved himself to be a competent railroad manager before his eminent father had fairly begun that line of business. It was almost entirely owing to his individual exertions and sound judgment that, in a few years, the Harlem road was double-tracked, and such other improvements made as sent the stock from 8 or 9 to above par. The Commodore was so highly pleased and agreeably surprised with his son’s management of the Harlem road that he made him Vice-President of the Hudson River Railroad also, and at a later date associated him in the same capacity with the management of the important consolidation of New York Central & Hudson River. The great executive power of William H. was manifested in every successive movement which his father directed, and unparalleled prosperity was the result in every instance. After William H. was fully installed in the Vice-Presidency of the consolidated system of the Vanderbilt railroads he became an indefatigable worker, taxing his physical and mental powers to their utmost capacity, and it was doubtless this habit of hard work, persisted in for many years, that resulted in so sudden and comparatively premature death for a member of a family famous for its longevity throughout several generations. He insisted on making himself familiar with the smallest details of every department, and examined everything personally. He carefully scrutinized every bill, check and voucher connected with the financial department of the immense railroad system, and inspected every engine belonging to the numerous trains of the roads. In addition to this general supervision of everything that pertained to the railroads, he was in the habit of going over a large amount of correspondence which the majority of other men not possessing the hundredth part of his wealth hand over to their clerks, and he answered a great number of letters with his own hand which financiers of comparatively moderate means are in the habit of dictating to their stenographers. When his father died, at the age of 82, in January, 1887, William H. Vanderbilt, then 56 years of age, found himself the happy possessor of a fortune variously estimated at from 75 to 90 million dollars. The remainder of the Commodore’s bequests amounted to 15 millions.
After the death of his father the executive powers of Wm. H. Vanderbilt, in the management of the vast railroad interests bequeathed to him, were called into active play. The great strike of 1877 among the railroad employes threatened to paralyze business all over the country, and came pretty near causing a social revolution. In this emergency a cool head and prudent judgment were valuable attributes to a railroad manager. Mr. Vanderbilt proved that he possessed both in more than an ordinary degree. Just prior to encountering the knotty problem of the strike he had been highly instrumental in bringing about suspension of hostilities in the freight war, and the course which he advised led to an arrangement that produced harmony among the trunk lines for a considerable period. As a consequence of the rate war the railroad companies were obliged to cut down the wages of their employes, and this was the chief element in causing the strike. There were 12,000 men in the employ of the New York Central and Harlem. Their wages had been reduced ten per cent. and they had threatened to annihilate the Grand Central Depot. Instead of making application to have the militia called out, as had been done in Pennsylvania, Mr. Vanderbilt—although a man possessed of far more than ordinary courage—with keen foresight proposed a kindly compromise with his employes. He telegraphed from Saratoga to his head officials an order to distribute $100,000 among his striking employes and promising them a restoration of the ten per cent. reduction as soon as business improved to a point justifying such an advance. This prompt and prudent action had the desired effect, and the consequence was that while there was a small insurrection in Pittsburgh, and bloody war to the knife, at great cost to Allegheny County, calmness reigned in the prominent railroad circles of New York, and the taxpayers escaped the burden that might otherwise have been put upon their shoulders, and the demoralizing effects of violence and bloodshed were prevented. Over 11,500 of the 12,000 men returned to work, thus showing their gratitude to Mr. Vanderbilt and faith in his promise, which was afterwards duly fulfilled. The policy of Wm. H., in the management of his great railroad system, unlike that of his father, was entirely pacific in its character. He was disposed to settle all misunderstandings by reason and arbitration, and had no inclination for fighting and conquest, after the manner of the Commodore. Although a very close calculator in business matters, a habit to which he adhered even to the precision of striking out superfluous items which should not have been charged in his lunch bill, Mr. Vanderbilt was in many respects generous to a fault. He compromised the suit with his brother, “Young Corneel,” allowing him the interest on $1,000,000, whereas his father had only left him the interest on $200,000, with a forfeiture clause in the event of “Corneel” contesting the will. Wm. H. also made a present of $500,000 in United States bonds to each of his sisters, out of his own private fortune. A good story is related in connection with the distribution of this handsome gift. Mr. Vanderbilt, it is said, went around one evening in his carriage, taking the bonds with him and dispensing them to the fortunate recipients from his own hands. One of his brothers-in-law having observed by the evening papers that the bond market had declined a point or two on that day, said, “William, these bonds fall $150 short of the $500,000, according to the closing prices of this day’s market.” “All right,” replied Mr. Vanderbilt, with assumed gravity, “I will give you a check for the balance,” and he wrote and signed it on the spot. It is related that another brother-in-law followed him to the door, and said, “If there is to be anything more in this line I hope we shall not be forgotten.” It is said that these remarkable instances of ingratitude, instead of irritating him, as they would have in the case of an ordinary individual, only served to arouse his risible faculties and that he regarded the exhibitions of human weakness as a good joke.
One of the greatest works of Mr. Vanderbilt’s life was the building of the beautiful palace on Fifth avenue, between Fifty-first and Fifty-second streets, which he adorned extensively with paintings selected from the great masterpieces of the most renowned artists of the world.
One reason assigned for his disinclination to speculate was that he regarded the property left by his father in the light of a sacred trust, and while he considered it a filial duty to look after its increase and accumulation, he was careful not to do anything that might risk its dissipation.
Mr. Chauncey Depew, who succeeded to the presidency of the New York Central & Hudson River Railroad Company, was upon one occasion, while visiting in London, a guest at a dinner given to the Hon. Wm. E. Gladstone, then Premier of England, and was honored by a seat on the left of Mr. Gladstone, with whom he discussed the differences between American and English railroad and financial management. In the course of conversation Mr. Gladstone said, “I understand you have a man in your country who is worth £20,000,000 or $100,000,000, and it is all in property which he can convert at will into cash. The Government ought to seize his property and take it away from him, as it is too dangerous a power for any one man to have. Supposing he should convert his property into money and lock it up, it would make a panic in America which would extend to this country and every other part of the world, and be a great injury to a large number of innocent people.” Mr. Depew admitted that the gentleman referred to—who was Mr. Vanderbilt—had fully the amount of money named and more, and in his usual suave and conclusive way, replied, “But you have, Mr. Gladstone, a man in England who has equally as large a fortune.”