Cornelius Vanderbilt

Cornelius Vanderbilt Cornelius Vanderbilt became the wealthiest man in America in the mid-19th century by dominating the growing countrys transportation business. Starting out with one small boat plying the waters of New York Harbor, Vanderbilt eventually assembled a vast transportation empire. When Vanderbilt died in 1877, his fortune was estimated to be in excess of $100 million.   Though he never served in the military, his early career operating boats in the waters surrounding New York City earned him the nickname â€Å"The Commodore.† He was a legendary figure in the 19th century, and his success in business was often credited to his ability to work harder - and more ruthlessly - than any of his competitors. His sprawling businesses were essentially prototypes of modern corporations, and his wealth surpassed even that of John Jacob Astor, who earlier had held the title of Americas richest man. It has been estimated that Vanderbilts wealth, relative to the value of the entire American economy at the time, constituted the largest fortune ever held by any American. Vanderbilts control of the American transportation business was so extensive that anyone wishing to travel or ship goods had no choice but to contribute to his growing fortune. Early Life of Cornelius Vanderbilt Cornelius Vanderbilt was born May 27, 1794, on Staten Island, in New York. He was descended from Dutch settlers of the island (the family name had originally been Van der Bilt). His parents owned a small farm, and his father also worked as a boatman. At the time, the farmers on Staten Island needed to transport their produce to the markets in Manhattan, located across New York Harbor. Vanderbilt’s father owned a boat used to move cargo across the harbor, and as a boy young Cornelius worked alongside his father. An indifferent student, Cornelius learned to read and write, and had an aptitude for arithmetic, but his education was limited. What he really enjoyed was working on the water, and when he was 16 he wanted to buy his own boat so he could go into business for himself. An obituary published by the New York Tribune on January 6, 1877 told the story of how Vanderbilt’s mother offered to loan him $100 to buy his own boat if he would clear a very rocky field so it could be farmed. Cornelius began the job but realized he would need help, so he made a deal with other local youths, getting them to assist with the promise that he would give them rides on his new boat. Vanderbilt successfully finished the job of clearing the acreage, borrowed the money, and bought the boat. He soon had a thriving business moving people and produce across the harbor to Manhattan, and he was able to pay back his mother. Vanderbilt married a distant cousin when he was 19, and he and his wife would eventually have 13 children. Vanderbilt Prospered During the War of 1812 When the War of 1812 began, forts were garrisoned in New York Harbor, in anticipation of an attack by the British. The island forts needed to be supplied, and Vanderbilt, already known as a very hard worker, secured the government contract. He prospered during the war, delivering supplies and also ferrying soldiers about the harbor. Investing money back into his business, he bought more sailing ships. Within a few years Vanderbilt recognized the value of steamboats and in 1818 he began working for another businessman, Thomas Gibbons, who operated a steamboat ferry between New York City and New Brunswick, New Jersey. Thanks to his fanatical devotion to his work, Vanderbilt made the ferry service very profitable. He even combined the ferry line with a hotel for the passengers in New Jersey. Vanderbilt’s wife managed the hotel. At the time, Robert Fulton and his partner Robert Livingston had a monopoly on steamboats on the Hudson River thanks to a New York State law. Vanderbilt fought the law, and eventually the U.S. Supreme Court, led by Chief Justice John Marshall, ruled it invalid in a landmark decision. Vanderbilt was thus able to expand his business further. Vanderbilt Launched His Own Shipping Business In 1829 Vanderbilt broke away from Gibbons and began operating his own fleet of boats. Vanderbilt’s steamboats plied the Hudson River, where he reduced fares to the point that competitors dropped out of the market. Branching out, Vanderbilt began steamship service between New York and cities in New England and towns on Long Island. Vanderbilt had dozens of steamships built, and his ships were known to be reliable and safe at a time when travel by steamboat could be rough or dangerous. His business boomed. By the time Vanderbilt was 40 years old he was well on his way to becoming a millionaire. Vanderbilt Found Opportunity With the California Gold Rush When the California Gold Rush came along in 1849, Vanderbilt began an ocean-going service, taking people bound for the West Coast to Central America. After landing in Nicaragua, the travelers would cross to the Pacific and continue their sea journey. In an incident that became legendary, a company that partnered with Vanderbilt in the Central American enterprise refused to pay him. He remarked that suing them in court would take too long, so he would simply ruin them. Vanderbilt managed to undercut their prices and put the other company out of business within two years. He became adept at using such monopolistic tactics against competitors, and businesses who went up against Vanderbilt were often made to suffer. He did, however, have a grudging respect for some rivals in business, such as another steamboat operator, Daniel Drew.   In the 1850s Vanderbilt began to sense that more money was to be made in railroads than on the water, so he began scaling back his nautical interests while buying up railroad stocks. Vanderbilt Put Together a Railroad Empire By the late 1860s Vanderbilt was a force in the railroad business. He had bought up several railroads in the New York area, putting them together to form the New York Central and Hudson River Railroad, one of the first great corporations. When Vanderbilt tried to gain control of the Erie Railroad, conflicts with other businessmen, including the secretive and shady  Jay Gould and the flamboyant Jim  Fisk, became known as the Erie Railroad War.  Vanderbilt, whose son William H. Vanderbilt was now working with him, eventually came to control much of the railroad business in the United States. Vanderbilt lived in a lavish townhouse and owned an elaborate private stable in which he kept some of the finest horses in America. Many afternoons he would drive a carriage through Manhattan, enjoying moving along at the fastest possible speed. When he was nearly 70 years old his wife died, and he later remarried a younger woman who encouraged him to make some philanthropic contributions. He provided the funds to begin Vanderbilt University. After a prolonged series of illnesses, Vanderbilt died on January 4, 1877, at the age of 82. Reporters had been gathered outside his townhouse in New York City, and news of the death of The Commodore filled newspapers for days afterward. Respecting his wishes, his funeral was a fairly modest affair. He was buried in a cemetery not far from where he grew up on Staten Island. Sources: Cornelius Vanderbilt.  Encyclopedia of World Biography, 2nd ed., vol. 15, Gale, 2004, pp. 415-416. Cornelius Vanderbilt, A Long and Useful Life Ended, New York Times, 1 Jan. 1877, p. 1.