Boston City (part 5 of 67)

The Western Railroad Corporation had been chartered in March, 1833, as a species of outgrowth of the Boston & Worcester, - that is, the direct¬ ors of the latter were individually made corporators of the former. The Boston & Worcester company thus had exclusive control over the exten¬ sion of its own enterprise. No formal action was taken under the charter for over two years, and until the road to Worcester was opened ; but in the meanwhile the project was a good deal discussed, and some subscriptions obtained in the towns along the proposed line. What with building at the same time three railroads, aggregating one hundred and twenty miles and calling for an outlay of three millions, the hands of the capitalists of Boston were supposed to be full. Accordingly no attempt was made to obtain subscriptions from them. Some time in the autumn of 1834 an informal offer had come from New York to subscribe the entire stock; but it was declined on the ground that its acceptance " might throw the whole enter¬ prise into the vortex of the stock-gambling operations of Wall Street." The proposed road was, too, essentially a Boston one; and it was feared, not without cause, that the control of the charter elsewhere, especially in New York, might not imply its early construction. Yet in Massachusetts at this time, even in the towns along the route, no confidence was felt in the financial outcome of the scheme, and frequent doubts were still expressed as to its being practicable at all. The Berkshire Hills were supposed to present a serious, if not insuperable, barrier to the wheels of a locomotive. So limited also were men's views, that even in a place like Worcester the project was regarded with disfavor by many, because the railroad already constructed having made that town a terminus, its extension further, it was thought, would be a local injury.

The celebration at Worcester took place on July 6. After it was over a directors' meeting was held on the train as it returned to Boston, and it was decided at once to enter seriously upon the extension to Albany. A month later stock subscription-books were opened at various points. The

1855, and July, 1856. The market value of the $115, or fell below $80. In 1854 it sold down to stock, though as a rule it has ranged high, has $57. In 1863 and 1870 it went up to $158. In fluctuated widely. When the road first went 1878 it fell again to $99; and then in 1S81 it into operation, it stood at about $125 per share, touched the highest point it had ever reached, During the next twenty years it never rose above - #164 per share.

want of faith in the financial success of the undertaking was, however, so general, that, even when these books were opened, subscriptions were urged almost wholly as a matter of public spirit. No one thought the road itself would be any more successful than the old Middlesex Canal had been; but it was argued that the community as a whole must derive great benefit from it. It was naturally a difficult matter to get any large amount of stock taken on this basis. Boston was thoroughly canvassed. Public meet¬ ings were held at which urgent appeals were made to all to subscribe, each according to his means. In itself, and under the circumstances of the time, the outlay called for was not a particularly heavy one. Boston was then a city of eighty thousand inhabitants, with an assessed valuation amounting to eighty millions. The increase since 1800 both in population and in wealth had been very great. Had any confidence been felt in the proposed road as a financial undertaking, the two millions required would, therefore, have been forthcoming at once. Considering the facts that a mania for railroad construction was then beginning both in England and in America, and that all three of the Boston initial lines were already more than answering ex¬ pectation, this want of confidence is now somewhat inexplicable. It was generally felt, however ; and, after every effort had been put forth, when at the expiration of the ten days fixed for keeping them open the subscrip¬ tion-books were closed, it was found that but thirteen thousand of the twenty thousand shares had been taken. Of these, eight thousand five hun¬ dred had been subscribed for in Boston. Renewed efforts were necessary. Accordingly, on October 7, a mass-meeting was held in Faneuil Hall, over which Abbott Lawrence presided. A report and resolutions were offered by Nathan Appleton, and speeches were made by delegates from many points, including Albany. Edward Everett closed the discussion, and a committee was then appointed to collect additional subscriptions, the members of which were directed to call on every man in the precincts assigned to them, " from the capitalist to the carman," to urge the vital necessity of subscrib¬ ing for one or more shares. The response to this appeal even was not suffi¬ cient, and another meeting was held on November 20. Again the subscription committee was sent out. The thoroughness of the canvass now made, and the difficulties the canvassers met, can best be inferred from these extracts from the diary of one of their number, - Josiah Quincy, Jr., - subsequently the first treasurer of the corporation : -

" Nov. 24, 1835. I went over the list of the voters in my ward to find out who had not subscribed, in order to call upon every man who is able, to learn whether he is willing to help on with this great undertaking."

" 25th. Went round with Mr. Edmund Dwight to obtain subscribers for the West¬ ern railroad, and they all with one accord began to make excuses. Some think the city is large enough and do not want to increase it. Some have no faith in legislative grants of charters since the fate of Charlestown bridge, and very few say they won't subscribe. It is the most unpleasant business I ever engaged in."

At last, by dint of much asking, the required amount of subscriptions was secured, and the books were closed on December 5 ; and on January 4 the corporation organized by the election of a board of nine directors, among the Boston members of which were Thomas B. Wales, William Lawrence, Edmund Dwight, Henry Rice, John Henshaw, Francis Jackson, and Josiah Quincy, Jr. Mr. Wales was chosen president, and Josiah Quincy, Jr., treasurer.

The list of the original subscriptions to this enterprise is a curiosity. It includes over two thousand two hundred names, and the average number of shares taken by each was consequently less than ten. Subscriptions were very generally made in firm names, showing the extent to which the under¬ taking was looked upon as an aid to the city's business interests, and not as a money-making enterprise. The majority of the subscriptions, also, were for single shares, and the desire felt by the subscribers to get rid of the can¬ vasser at the lowest price possible, short of a refusal to subscribe at all, is quite apparent. The largest subscription was but for two hundred shares; and names always associated in Boston with the idea of great wealth are found in this list set down opposite to amounts representing a risk, in what has since proved one of the most reliable of investments, of five hundred or a thousand dollars.1

The general expectation was, in fact, that, after one unsuccessful effort, all idea of building the road as a private enterprise would be abandoned, and the work would be taken up by the State. This opinion was shared in by the directors. An attempt, as ingenious as it was successful, to secure State aid was accordingly made as soon as the Legislature met. President Jackson's war on Nicholas Biddle's Bank then filled the public mind. The Democratic party was intensely and blindly hostile to all banking schemes ; and of this fact the friends of the railroad now skilfully availed themselves. Protesting that they asked no grant from the Treasury of the Commonwealth, but merely a chance to raise an income for themselves, they succeeded in getting a bill reported creating the " State Bank of Massachusetts," with a capital of ten millions, one million of which the directors were required to subscribe for ten thousand shares of the stock of the Western Railroad Cor¬ poration. The proposal at once created great excitement. The Democrats were bitterly opposed to a bank ; but it soon became apparent that the friends of the bank and of the railroad combined would be strong enough to carry the measure. Accordingly, the Democrats themselves came for-

1 The largest subscription was that of James The Appletons, Samuel and William, the Grays, K. Mills & Co., 200 shares. A. & A. Lawrence J. C., F. C., and Horace, G. W. Lyman, John & Co., and Whitwell, Bond, & Co., each sub- Parker, Jno. Phillips, the Pratts, G. W. and Wilscribed for 150. Nathan Appleton, Lawrence & liam, Wm. Sturgis, John Tappan, T. B. Wales, Stone, Palmer Company, T. H. Perkins, T. R. and several others subscribed for 50 each. Many Sewell, R. G. Shaw, Israel Thorndike, Water- well-known Boston names are not found at all. ston, Pray, & Co., and J. D. Williams, each for A number of the subscriptions, including some 100. Governor Everett subscribed for 20 shares ; of the larger ones, suggest grave doubts as to the as also did J. E. Thayer. W. Raymond Lee sub- good faith with which they were made. Nothscribed for 50 shares, and W. F. Weld for 10. ing was paid in on them.

ward with a proposition for direct State aid to the railroad. This the friends of the latter eagerly accepted; it passed the House by a vote of two hun¬ dred and forty-three to nine, was slightly amended in the Senate, and finally received the Governor's signature on April 4, [836. As soon as the sub¬ scription bill was deemed safe, the bank bill was indefinitely postponed. A further sum of one million dollars was thus secured.

Before work could be begun it was necessary to have ten per cent paid in on the stock. This first assessment, even, the treasurer found great difficulty in collecting. The country was poor, and the war on the banks had led to a violent contraction of the currency. The financial crisis of 1837 was impending. While, therefore, the great majority of those who had subscribed for stock responded readily enough, there were some who had failed, some who had moved away, some who declared that when they sub¬ scribed they had done so with the understanding that upon paying five per cent they might relinquish their shares, and still others who simply refused to respond at all. It so happened, however, that Harrison Gray Otis, David Sears, and certain other wealthy Bostonians had refused to subscribe, ap¬ parently not being willing to bind themselves to payment in full for such amounts of stock as they would have been expected to take; but in doing so they had agreed to give outright to the enterprise sums amounting in the aggregate to several thousand dollars. This money was now applied by the treasurer to the payment of the assessment on the defaulted stock, which new parties were then induced to subscribe for at a discount of ten per cent. The treasurer was thus enabled to report that the requisite amount had been paid in on every share ; and early in 1837 the work of grading was at last begun.

The subsequent financial history of the Western road makes no part of the present work, except in so far as it relates to Boston and its citizens. As has been seen, however, the enterprise was essentially a Boston enterprise, for citizens of Boston constituted numerically more than half of its original body of stockholders ; and then, and ever since, they have held more than two-thirds of its stock. The president and the treasurer of the corporation were both citizens of Boston, and in Boston the burden of construction all through the dreary years which succeeded the crisis of 1837 made itself most heavily felt. The stock was widely distributed among those in active business ; and no day then passed without its record of business failures. The banks suspended specie payments. Private credit had received a severe shock; and matters presently became so bad, that when, in 1838, an issue of the State scrip, made in further aid of the enterprise, was sent to Lon¬ don for sale, the bonds were after a time returned by the house of Baring Bros. & Co., on the ground that "owing to the repudiation of Pennsylvania, there was no sale of American stocks at any price." The construction of the road by unaided private enterprise would, therefore, at the time and under the circumstances have been simply impossible. Had not the State lent its aid, work must have been suspended and bankruptcy would have ensued. In the full light of subsequent experience, however, it admits of question whether this would not have been better for Boston, and better for the State. The completion of the Western road, at the time and in the way it was completed, proved in the end far from an unmixed public benefit. Had a failure and temporary suspension of the work taken place in 1837, a reorganization would soon have been effected, and the line would have been built through a few years at farthest later than it was. Possibly, too, it might have been built by sections, and as an extension of the Boston & Worcester, under one ownership and management with it. Private enter¬ prise would have proved easily equal to the whole undertaking.

As it was, the apparent success of this experiment of State aid became at a later day a precedent and an argument. As such it led to other and far larger, while much less judicious, experiments of the same kind. As will presently be seen, also, the premature construction of the Western road, not as an extension of the Boston & Worcester, but independent of it and in some degree antagonistic to it, was productive of other results now ap¬ parent enough, but which then could not be foreseen. Palsied by State aid, the Western road never got firmly rooted in the private enterprise and capital of Boston. For years it remained in the air, as it were. It was separated from its natural base ; and this fact very sensibly affected the course of subsequent events. The railroad to Albany should in the devel¬ opment of those events have been to Boston what the Pennsylvania was to Philadelphia, and the Baltimore & Ohio was to Baltimore, - the nucleus about which the ability, enterprise, and capital of the city crystallized, until it enlarged and strengthened into the basis of what was to prove an ex¬ pansive external development. This did not take place. Instead of it the two segments of what should have been a single property wasted twenty years in bickering over the division of a joint business; while the private wealth and individual enterprise of Boston sought and found their field in a system of railroads which made Chicago its base. The railroad map of the United States might well, therefore, so far as Boston is concerned, have been far different from what it ultimately became, had the State in 1837 held fast to its principles, and forced private enterprise to work out its destiny in obedience to business laws, unincumbered by legislative aid.

At the time, however, nothing of all this could have been foreseen ; and it was natural enough for the promoters of what was really a great public undertaking to look to the State in their extreme need. They did not look in vain. In 1838 they obtained from the Legislature another measure of re¬ lief; in 1839 yet another; and still a fourth in 1840. The road, estimated to cost three millions, required about seven millions to complete it, - of which five millions were supplied from the public purse. The final assessment of forty per cent on the private stock was not called in until after the line had been opened through to Albany, in January, 1842. The Western Railroad was the most considerable enterprise of its kind which had then been un- dertaken in America ; and, taking all the circumstances of time, novelty, and financial disturbance into account, it may well be questioned whether anything equal to it has been accomplished since. It does not of course need to be said that, as compared with many of those enterprises since hurried to completion across the Plains or amid the Rocky Mountains, the one hundred and. fifty-five miles of track painfully built through the Berk¬ shire Hills between 1837 and 1842, at an average rate of twenty miles a year, was a very small affair. It was, however, a pioneer. It showed what could be done, and how the locomotive could climb. The voyage of Co¬ lumbus, though made in a very small vessel, has lost none of its interest because much bigger vessels are now built, and crossing the Atlantic has become an every-day affair; neither will Fremont's passage of the Rockys ever cease to be a memorable event, notwithstanding the fact that trains may run as regularly between Chicago and San Francisco as they do be¬ tween Boston and New York.

Of all those connected with the building of the Western road, George Bliss, of Springfield, was the one upon whom the heaviest burden of the work devolved.1 He, however, was never identified with Boston. Of the Bostonians connected with it, three - Thomas B. Wales, Josiah Quincy, Jr., and P. P. F. Degrand - deserve especial mention. Mr. Wales is identified rather with the Providence than with the Western road, though he was president of the latter from the first organization of the company until the locomotive was running to Albany. In February, 1842, he declined a reelection. Mr. Wales was one of that school of Boston merchants common enough in the first half of the century, but which gradually passed away with the advent of steam. He was born in Randolph, Mass., on the first day of the year 1776, and graduated at Harvard College in the class of 1795. The active portion of his business life was passed in his counting-room on the wharf in Boston which bore his name, and from which he traded with various European ports, more especially those of France. Noted for in¬ tegrity and methodical business ways, he had already, when the railroad era dawned, retired from active mercantile life with what was in those days looked upon as an ample fortune. Under these circumstances, and as his name was respected wherever it was known, younger men in organizing the railroad schemes naturally turned to him as one whose known connection with those schemes would give them character. He responded freely, and accepted the presidency of the Western road from motives of the purest public spirit, at a time when the outlook for the enterprise was far from encouraging.

Mr. Degrand was, as his name indicates, of French descent, and himself an immigrant. In accent, in appearance, and in manners he remained indeed to the end of his life a French gentleman of that formal school which sur-

1 [He printed an Historical Memoir of the the marshes, with the city beyond, and showing Western Railroad in 1863. A view of the cross- the style of cars used about 1840, is given in ing of the Worcester and Providence roads on Barber's Hist. Coll, of Mass. - Ed.].

vived the Revolution only in the provinces. In active business as a broker in Boston, he was an enthusiast on the subject of railroads; and, though not himself a man of large means, most forward in promoting them. A general favorite among men of business, and much respected for his integ¬ rity of character, he was a good deal ridiculed for the extravagance of his predictions, all of which have, however, since been more than realized. He was wont, among other things, energetically to refer to the Worcester road as a forty-four mile extension of Boston Long-Wharf. He was the author of the address to the people of the State issued by the stockholders of the Western Railroad Corporation in January, 1841, which resulted in the third grant of aid. He was, however, not always so fortunate in his methods of appeal ; and he created a good deal of amusement by one of them, which was suggested to him by a sermon the Rev. S. K. Lothrop

1 [This cut follows an original likeness painted in 1843 by George P. Plealey, and now in the possession of George W. Wales, Esq., a son. - Ed.]

had delivered in the Church in Brattle Street, on the subject of the moral and Christianizing influence of railroads. This discourse attracted at the time a good deal of attention ; and Mr. Degrand, seizing the opportunity, forthwith got up a circular on his own account, a copy of which he sent to every clergyman in Massachusetts. In it he suggested the propriety of dis- courses on the moral and Christianizing influence of railroads in general, - and of the Western Railroad in particular. He died in the year 1855.

Josiah Quincy, Jr., was at a subsequent period too closely connected with the municipal history of Boston to call for any detailed mention of him here. At the time of his election as treasurer of the Western Railroad Cor¬ poration, in January, 1836, he was thirty-four years of age, and a lawyer by profession. Abandoning that calling in view of the engrossing nature of

1 [This cut follows a likeness hanging in the Railroad Station. Mr. Quincy was also painted president's room of the Boston & Providence by Page, about 1845. - Ed.]

the new duties imposed upon him, he devoted himself wholly to the care of the company's finances. He resigned in February, 1848, after twelve years of arduous service, to the value of which the stockholders of the company bore testimony in a vote of earnest thanks entered upon their records. During the period of construction, the whole management of the finances of the company was devolved on Mr. Quincy. Strange as it seems, there was even no standing committee, of the directors, on finance. His sanguine temperament then enabled Mr. Quincy to meet difficulties in the presence of which a more cautipus man would have stopped; and, throughout the long financial depression from 1837 to 1843, he always succeeded in some¬ how or somewhere borrowing money enough to keep the work of construc¬ tion going on. At one time he got it from the banks and the institutions of savings; at another from the firm of Baring Bros. & Co.; and then, as a last resort, lie squeezed it out of the embarrassed stockholders. He just succeeded in weathering the storm. He did weather it, however; and when, after seeing the stock of the company selling at $40 a share in 1843, he five years later resigned, the same stock had for three years stood at a pre¬ mium, dividends were paid upon it regularly, and the debt of the company was being fast paid off.

The Western Railroad 1 was opened through its entire length during the last days of the year 1841, and the event was celebrated in the usual way. On the 27th of December the Boston City Government went to Albany, where they were duly entertained ; and on their return they brought with them their hosts, who partook of a municipal dinner on the

1 The consolidation of the Boston & Worces¬ ter and the Western Railroad Companies took place in January, 1868, under an Act incorpor¬ ating the Boston & Albany Railroad Company, passed by the Legislature of the previous year. The barrier in the way of the commercial devel¬ opment of Boston, occasioned by inability of the two original companies to act in harmony, had gradually given rise to a feeling of deep-seated popular discontent. A movement looking to the purchase of both roads by the State, under its reserved rights, had been started in the autumn of 1S66 by Mr. Josiah Quincy. Ilis scheme looked to a public management; and the utter absence of ocean steamship facilities at the port, which a year later led to the entire withdrawal from it of the Cunard line of steamers, caused the suggestion to be much discussed. The result was the consolidation of the two companies un¬ der a single management. Prior to this event it is a curious fact that the direct through line from Boston to the West had practically no means of receiving or delivering ocean freights at tidewater.

road, by means of which it reached the docks at East Boston. During the same year it effected an arrangement with its western railroad connec¬ tions by which produce could be shipped through to Europe by way of Boston, at the New York rate. The revival of Boston as an ocean steam¬ ship port dates from this time, and was very rapid. In 1S67 no steamers sailed regularly from Boston to any foreign port. During the year 1SS0 no less than 333 steamers cleared from it. The exports by way of Boston had increased proportionately, - that of wheat-flour, for in¬ stance, from 177,000 barrels to 3,678,000; that of cheese, from 40,000 pounds to 4,335,000; that of lard, from 767,000 pounds to 48,000,000; while of live animals, 95,755 were exported in 1880, while none had been exported in 1870.

The management of the consolidated line was financially most successful. Its gross earn¬ ings rose from $6,000,000 in 1S68, to $9,800,000 in 1873. Under the influence of the depression which followed the crisis of that year, they then fell away to $6,400,000 in 1S79; but in 18S0 they began to rise again, and amounted to $7,740,000.

evening of December 30. These two occasions were enlivened by the usual interchange of sentiments and speeches, which now seem dull and prosaic enough. The novelty of railroad construction had already passed away.1

From the date of the completion of the Western road, the history of local railroad development, so far as Boston is concerned, becomes a mere record of dates and statistics. An article in the Monthly Chronicle , for June, 1841, begins with these words: "The magnificent system of railroads, extending from a common centre at Boston, throughout the State of Massachusetts, and reaching to four of the adjoining States, is now nearly completed." The "magnificent system" thus referred to included three hundred and thirty-seven miles of road, which had cost about $14,000,000, and earned in 1839 $1,000,000 in gross. The Eastern was a part of this system, as well as the three initial Boston lines. This road was a Salem enterprise. It originated with Mr. William IT. Foster, a citizen of that place, and then, and down to the year 1881, cashier of the Asiatic Bank there. It was char¬ tered in April, 1836. George Peabody, a Salem merchant and a relative of the more famous London banker of the same name, was the first president of the company, and in 1840 was succeeded by Captain David A. Neal, also of Salem. A few years later Captain Neal became very prominent among the earlier railroad magnates, being closely identified with both the Reading road, of Pennsylvania, and the Illinois Central. It was not until 1854, however, that the Eastern reached a station on Causeway Street, in the city proper. Prior to that year its southern terminus was at the wharf in East Boston, from which it made a ferry connection.

Chartered in March, 1833, as a branch of the Lowell road, and under the name of the Andover & Wilmington Railroad Corporation, the Boston & Maine did not reach its final terminus in Flaymarket Square until 1845. It had originally received the name it has since borne from an act of the Legislature of New Hampshire, passed in June, 1835; and the Boston & Maine Railroad Company of Massachusetts was not created until March, 1841, when portions of the line had already been for nearly five years in operation. When it took its place as one of the Boston terminal roads on the first of July, 1845, it had become, consequently, a comparatively well

1 There was, however, in these two entertain¬ ments one episode, - the last of the sort in Mas¬ sachusetts, - which fairly marked the close of the first era in railroad construction ; an incident which showed that railroads had not yet become wholly commonplace affairs. Among the guests who went to Albany with the Boston City Gov¬ ernment was a party of gentlemen from New Bedford. The incident referred to was as fol¬ lows : -

" In order to lend point to the astonishing fact that, leaving their homes in the morning, they would in fifteen hours be in Albany, these gentlemen, during the small hours of the day of their departure, caused some spermaceti candles to be moulded, which they took with them on their trip ; and that evening the rays from those candles illumined the table around which took place the civic banquet at Albany. But the Al¬ banians were not to be outdone. They were to return to Boston with their guests the next day; and in doing so they took with them a barrel of flour, the wheat for which had been threshed at Rochester on the previous Monday ; they went to Boston on Wednesday, while the barrel itself was made from wood which on the threshingday had been growing in the tree. This flour, duly converted into bread, the authorities of the two cities, and their invited guests, solemnly ate at a great dinner given at the United States Hotel in Boston, on the evening of Dec. 30, 1841." developed enterprise, controlling seventy-four miles of track in operation, earning annually $350,000, and represented by a capital of $2,380,300.

The Fitchburg road was likewise opened through to its western terminus during the year 1845. This line, more probably than any other of those centring in Boston, owed its early construction to one man, - its first presi¬ dent, Alvah Crocker, of Fitchburg. Mr. Crocker was the very embodiment of Yankee activity and energy. His body was rarely quiet; and it may safely be said that his mind and his tongue never were. An active friend of the Western in the Legislature of 1836, he conceived the idea of a similar railroad to his own town, then a place of about two thousand five hun¬ dred inhabitants. When he went home after the adjournment he began at once in his peculiar fashion to agitate the matter. The line proposed followed the canal route surveyed by Colonel Baldwin in 1825, and ran through a wild and sparsely settled region, where the idea of building a railroad seemed at the time little less than preposterous. Mr. Crocker, however, was not a man to be turned aside from his project; and at last, in March, 1842, he secured his charter. On Dec. 20, 1843, the road was opened to Waltham; and March 5, 1845, the first locomotive ran into Fitchburg, with Mr. Crocker upon it.

In the autumn of the same year in which the Boston & Maine, and the Fitchburg entered Boston on the north side, the Old Colony entered it on the south. This road, chartered in March, 1844, was opened through to Ply¬ mouth, Nov. 10, 1845. ^ at first terminated in the Lincoln Street station of the Boston & Worcester. This arrangement, however, was but temporary; and in June, 1847, the Kneeland Street station was opened.1

1 The Old Colony, more than any other of the corporations owning roads terminating in Boston, has throughout its history pursued a policy of development and acquisition. Why this should have been so in the case of this corporation, and not so in the case of the others, it would not be easy to explain. The fact, however, remains. Originally chartered in March, 1844, as the Old Colony Railroad Corporation, with a capital of $1,000,000, to build a road from Boston to Ply¬ mouth, in 1854 it became, through a consolida¬ tion, the Old Colony & Fall River Railroad Company. In 1862, by another consolidation, it became the Old Colony & Newport Railway Company; and at last, in 1S72, by a third con¬ solidation, it became the Old Colony Railway Company. The original road to Plymouth was 37 miles in length. By extension, consolidation, and leases, the Old Colony system has expanded, until, in 18S0, it included 475 miles of road, - a larger amount than was then owned or operated by any other Massachusetts corporation. It held, in fact, undivided control of the south¬ eastern portion of the State.

prise was projected at a later period, when the idea of risk had ceased to be connected with railroad subscriptions. The stock, especially of some of the lines like the Cape Cod, brought into the consolidation at more recent dates, was quite widely distributed, and the management of the road has been a somewhat shifting one. The policy pursued has, however, always been the same, and in striking and happy contrast to the policy pursued by the corporations the roads of which terminated on the north side of the city. The contrast furnishes, indeed, a most suggestive illustration to both the owners of railroads and the communities served by them, of the advanta¬ ges and disadvantages of competing and consol¬ idated lines.

Nathan Carruth, of Dorchester, was the first president of the Old Colony; and William Thomas, Jacob H. Loud, Uriel Crocker, and Josiah Quincy, Jr., were members of the earlier boards of direction. Mr. Carruth was succeeded as president by E. Hasket Derby, in 1848. The original one million of capital of the company has been increased from time to time through consolidation and otherwise, until in 1S80 it amounted to over seven millions, with more than five millions of funded debt.

New-Year's day, 1846, thus found seven distinct Boston terminal lines, and the number did not further increase for ten years. In 1855 what is now the New York & New England, then known as the Boston & New York Central, the successor of the Midland and the predecessor of the Boston, Hartford, & Erie, found its way, through a slough of bankruptcy, to a ter¬ minus in the city on Broad Street. It was opened to Putnam, in Connecti¬ cut, in January, 1855. It is a fact worthy of notice that this alone, of all the Boston terminal roads, reached at last, in 1879, what might be called a con¬ dition of fair prosperity only as the result of a series of failures and reorgan¬ izations stretching through a period of more than twenty-five years.1 As business enterprises, all the others were at the outset successful.

The last of the lines reaching an independent terminus in Boston was the narrow-gauge road known as the Boston, Revere Beach, & Lynn, organ¬ ized under the general railroad law of the State in May, 1874, and opened through to Lynn, July 29, 1875. It was designed for passenger business only ; and its city terminus is at East Boston, from which it connects with its station on Atlantic Avenue, in the city proper, by means of a ferry.

The local railroad-system distinctly tributary to Boston as a considerable railroad centre, and opposed to the other large railroad centres of the coun¬ try, may be said in 1880 to have consisted approximately of 3,000 miles of road. These serve a region covering the whole of New England, north of the Connecticut and Rhode Island lines, and east of the Berkshire Hills and the Green Mountains of Vermont. Within those limits the traffic is at points, as along the Connecticut, divided not unequally between Boston and New York; beyond them, the tendency is distinctly to the latter city.

As compared with the other great railroad centres of the East, - with Montreal, New York, Philadelphia, and Baltimore, - one striking peculiarity of the Boston situation is that the city has not, and never has had, any com¬ plete route connecting it with the interior, which has been controlled and operated in its local interest. An all-rail connection with the West by way of Albany was effected in 1841 ; and another by way of Troy, when the Hoosac Tunnel was completed, in 1875. Still another had been opened, when in September, 1851, the completion of the Vermont Central, which perfected the city's communication with Canada, was celebrated with rejoic¬ ings lasting through many days.2 But, though these and other outlets to the interior have been opened, none of the Boston terminal lines, unlike those of the other great sea-board cities in this respect, have developed within them¬ selves an expansive force sufficient to carry them beyond the local system into what may be termed the continental arena. The probable explanation of this fact has already been alluded to. It lay in the premature develop-

1 In the Massachusetts Legislative Docu- 2 [See An Account of the Celebration Comments for 1877 (House, No. 325) is a curious memorative of the Opening of Railroad Commu- "genealogical chart" of the New York & New nication between Boston and Canada, Sept. 17-19, England. Some twenty corporations, all of 1851. Boston: 1852. The newspapers of that which had been insolvent, seem at different day have full reports of the procession and festimes to have been merged in it. tivities. - El>.]

ment, through State aid, of the Western road as distinct from its eastern end, the Boston & Worcester, which held the terminus in Boston. At the very moment of the completion of the Western, consequently, the active business management of it as a corporation passed away from Boston and centred at Springfield. Nor was that all. Instead of being a period of concentration for development outside of the State, the succeeding twentyfive years in the history of both the Western and the Boston & Worcester corporations were wasted in a succession of controversies and bickerings, which ended only with their consolidation in 1866. At the same time the public mind and the resources of the State were diverted in another and false direction, as the scheme for tunnelling the Hoosac Mountain gradually assumed shape. So far as Boston was concerned, therefore, the western railroad horizon did not enlarge. In 1875 it was just where it was in 1825, - at the Hudson River. While New York, Philadelphia, and Baltimore had pushed their systems forward to the Mississippi, and were reaching out in every direction, Massachusetts was spending millions to get a competing line through to a point near the mouth of the Mohawk, which had been reached years before, and which had long ceased to be of any large com¬ petitive consequence.

From legislative wisdom in dealing with such matters, all experience shows that good results can hardly be expected. As a rule it is either hopelessly wrong, or hopelessly behind the times ; in this case it chanced to be both. A policy of systematic dissipation of resource was pursued at a time when its concentration was above all else necessary ; and, while the great corporations which served other cities were absorbing into themselves the thoroughfares in the valley of the Mississippi, the Legislature of the State of Massachusetts kept its eyes steadily fixed on the Hoosac Moun¬ tain. From private enterprise and keener individual judgment better re¬ sults might have been anticipated. Nor did the opportunity pass unnoticed. Unfortunately when it presented itself, the president of the Western road, though a man of marked ability, was not a citizen of Boston. What is called a self-made man, Mr. Chester A. Chapin had all his life been a resident of Springfield. He was familiar only with the western portions of the State. He was not at home in Boston, and the capital and enterprise of the city neither naturally centred about him, nor did he know how to put himself in communication with them. It was under these circumstances that the one great opportunity for the development of the Boston railroad system pre¬ sented itself, and was lost.

Mr. Chapin succeeded to the presidency of the Western Railroad Corpo¬ ration in 1854. At that time the New York Central, both as respects owner¬ ship and management, was not what it subsequently became. Its capital was but twenty-three millions, instead of the ninety millions it had been swollen to in 1880; and the value of its stock was so little appreciated, that between 1854 and i860 it ranged from $50 to $95, with an average market price of, perhaps, $80 a share. Neither was its ownership concentrated in the hands of a few men. On the contrary, it was widely scattered and largely dealt in on the Exchange. The road was in fact for sale, and continued to be so until it was bought up by Cornelius Vanderbilt in 1868. Shortly after assuming the presidency of the Western, Mr. Chapin became satis¬ fied that a controlling interest in the New York Central could not only be secured, but that it could be secured for a comparatively small sum of money. The amount required did not indeed exceed nine millions. That it was most desirable to secure this control on behalf both of the Western road and the city of Boston, was obvious. Seeing the matter in its future bearings very clearly himself, Mr. Chapin repeatedly brought it to the notice of those in Boston who were connected with his company. For the reasons which have been pointed out, however, he failed to in¬ terest them in his project, or to impress them with its importance. He offered himself to secure one million of the nine millions required; but the necessary contribution could not be made up. So much in earnest, however, was Mr. Chapin in the matter, that, having failed to accomplish anything himself towards bringing about the result he desired, he had re¬ course to others. He sent for James D. Colt, afterward one of the justices of the Supreme Court of the State, but then a leading lawyer in Berkshire, and requested him to go to Boston and present the matter in the proper quarters. Both the mission and the messenger singularly illustrated the separation which then existed between the main artery of Boston's com¬ merce and Boston's financial and business men. So far from being able to effect a combination to carry out a great scheme, the importance of which he alone seems to have fully realized, the Springfield president of the Wes¬ tern Railroad Corporation did not even know how to put himself in com¬ munication with the men who were necessary to make up the combination. Mr. Colt was a lawyer. The business in hand, however, was one to be transacted not with lawyers or judges, but with bankers, and men of busi¬ ness and of capital. To carry it through would have required a great com¬ mand of money, and that confidence which comes only from the habit of long acting together. Mr. Colt went to Boston and presented the matter as well as he could to a few persons. He failed, however, to interest them in it, either because of its magnitude, or because they did not appreciate its importance. Nothing came of his mission, and Mr. Chapin reluctantly abandoned his scheme as the time for carrying it out slipped away. It is needless to add that the opportunity did not again present itself.

In point of fact, however, even at this time, the individual enterprise and private capital of Boston had already found another, though not more profitable, field of operations. There was what might be called a larger Boston railroad development going on in the West. This dated from the year 1845, and subsequently filled so large a space in the financial opera¬ tions of Boston, and added so much to its accumulated wealth, that some¬ thing more than a mere reference to it is necessary. -In 1845 there was no all-rail line from the seaboard to the interior. The disconnected roads, which were subsequently consolidated into the New York Central, termi¬ nated at Buffalo, where they connected with a line of steamers which ran to Chicago, stopping at Detroit. From Detroit the State of Michigan had some years before, during the mania for railroad construction which made part of the financial crisis of 1837, built a line to Kalamazoo, in the direc¬ tion of Chicago. The State had then become insolvent, and the incompleted road, which was laid with strap rails only, gradually wore out. Its sale was accordingly agitated in the public prints, and the discussion attracted the attention of John W. Brooks, who was then superintendent of the road be¬ tween Auburn and Rochester. Mr. Brooks was a native of Massachusetts, born in the town of Stow, in 1819. He learned what engineering he knew in the office of Loammi Baldwin, and subsequently on the Boston & Maine, but had removed to the State of New York in 1844. Being young, ambi¬ tious, and very active-minded, he now concluded that it would be worth his while to go to Detroit and look into the situation there. He soon became satisfied that if the railroad to Kalamazoo was extended through to New Buffalo, on the south-eastern shore of Lake Michigan, it would, as a link in a mixed land-and-lake through-line to Chicago, become a valuable property. He accordingly returned to the East with a view to there effecting some com¬ bination to buy up the worn-out and incompleted road, and to renew and finish it. He went first to Boston, where he met with no encouragement. Nor was this surprising. Mr. Brooks at the time was but twenty-six years old. He had almost no acquaintance among men of wealth. Hardly more than a boy, he appeared asking, for the purchase of an unknown railroad in the bankrupt West, a sum of money larger than that which but a few years before Boston had in reality failed to raise to build its long-talked of line to Albany, - failed to raise, too, after Faneuil Hall meetings and resolutions, and speeches from Governor Everett, and much canvassing by committees. Fortunately Mr. Brooks was a man who not only understood his business, but who understood himself likewise ; accordingly he was not easily turned aside from his purpose. Though he could get no assurance of aid from Boston, he did get letters to John C. Green and others in New York; and, going there, found that the Farmers' Loan & Trust Company held a large amount of defaulted securities of the State of Michigan. This fact made that company very desirous to have the State sell its public works in order to restore its credit; and to effect the sale it was necessary to provide a pur¬ chaser. Here, therefore, Mr. Brooks found something on which to base securely the combination he proposed to effect.

Returning to Michigan, he caused the necessary legislation to be pre¬ pared. His counsel was Mr. James F. Joy, then a lawyer in active practice at Detroit. The measure now prepared was submitted to the Michigan Legislature at its next session, and an act authorizing the sale of the State road, and incorporating the Michigan Central Railroad Company, was finally passed in March, 1846. The price of the existing one hundred and fifty miles of road was to be two million dollars ; it was to be completed through to Lake Michigan within three years, and equipped throughout with sixtypound rails. Six months' time was allowed for the formation of the com¬ pany and the acceptance of the charter.

backing in New York aided him greatly, and John M. Forbes had become interested in the project. The thing moved, however, very slowly. It was the first considerable venture of the kind which eastern men had made at the West, and, feeling a natural doubt as to its outcome, they went into it slowly and with great hesitation. It took nearly the entire six months to effect the necessary combination. The principal Boston parties finally concerned in it were John E. Thayer and John M. Forbes; with whom, also, was Captain David A. Neal, of Salem. vol. iv. - 19.

The Memorial History Oe Boston

The road was purchased within the time allowed by the act, and the new company organized. Its principal office was in Boston. Mr. Forbes was chosen president, and Mr. Brooks superintendent; John E. Thayer was the financial representative. The combination was a powerful one. Mr. Forbes was then in the prime of life, and he brought an inexhaustible resource, energy, and knowledge of men to bear on the new enterprise. The success which followed was, however, mainly due to Mr. Brooks. Naturally gifted with quick insight and unfailing courage, he combined with great organ¬ izing capacity a remarkable executive ability. He thus carried the under¬ taking through with insufficient means and against obstacles of the most formidable character. More probably than any other man he opened the way to the investment of eastern capital in the railroad development of the West. It was not, however, until 1849 that he succeeded in completing the Michigan Central to New Buffalo. That point continued to be its ter¬ minus until 1852, all freight and travel crossing Lake Michigan by steamer. In 1852 all-rail connection was at last made with Chicago.

The Michigan Central now became what the Western Railroad should have been, - the nucleus around which Boston capital centred, and the base from which it expanded. Founded on individual enterprise and private capital, - unhampered by the necessity of perpetually looking to a Legis¬ lature for assistance from the public purse to accomplish a given result and no more, - this enterprise was instinct with the spirit of development. That spirit, too, was continually asserting itself. The completion of the road through to Chicago was looked upon as an end, - as much an end to that enterprise as the completion to Albany was to the Western. Scarcely, however, had the Michigan Central reached Chicago, when Mr. Brooks and Mr. Joy, in looking the situation over, concluded that it would be for its interest to have a connection with the Illinois Central, running north and south, at Mendota, fifty miles further west. They accordingly purchased a little road called the Aurora Branch, thirteen miles in length, and got its charter so amended as to authorize an extension to Mendota. Their plan then included nothing more. It looked merely to securing the business of the north-western portion of the Illinois Central for the Michigan Central. In it, however, lay the germ of a great railroad enterprise.

While Mr. Joy was at Springfield, securing his amendments to the char¬ ter of the Aurora Branch, he met there other parties on a similar errand. They were trying to get the Legislature to alter the charter of a road known as the Central Military Tract Company, so that under it a connection could be built east from Galesburg. A road was already building from Burlington in Iowa to Peoria, which would pass near Galesburg. Mr. Joy had a bound¬ less faith in the future of the West. Instinctively taking in the possibilities of the situation, he secured the legislation he wanted, made a verbal ar¬ rangement with the Galesburg interest, and then started at once from Springfield for Boston. He there laid his project for the new enterprise ment. In New York he was somewhat more successful, getting subscrip¬ tions to the amount of $150,000 from Mr. Green and George Griswold. Returning to Boston he now induced the Thayers, Mr. Forbes, and others to subscribe, though for a less aggregate amount; and in the West he and Mr. Brooks raised further sums. In all about $500,000 was gotten together. 1 he Central Military Tract charter was then secured; and with $500,000 of stock subscriptions only to rely upon, Messrs. Joy and Brooks under¬ took the construction of the first one hundred and thirty miles of what afterward became the Chicago, Burlington, & Quincy Railroad.

I he subsequent extension of this system in the hands of the able men who originated it is a narrative by itself. It is beside the present purpose to enter upon it here. It only remains to add that in 1875 the ownership of the Michigan Central having passed into New York hands, the offices were removed from Boston. The company then owned and operated eight hun¬ dred and three miles of track, representing in all forty millions of securities. Unlike the Michigan Central, the Chicago, Burlington, & Quincy continued to be chiefly owned and managed in Boston. At the close of 1880, and as the result of less than thirty years of expansive development, it had be¬ come a system by itself, serving a vast extent of country. It owned, leased, and operated over three thousand miles of road, or eleven hundred more miles than there were at the same date within the limits of Massachusetts. Having crossed the Mississippi at Burlington, it crossed the Missouri at Plattsmouth, and extended several hundred miles toward the Rocky Moun¬ tains on the west ; while towards the south it reached Kansas City. At this point it connected with the Atchison, Topeka, & Santa Fe, and at Omaha with the Union Pacific.

Both of these last named lines also had been mainly constructed by Bos¬ ton enterprise, and were largely owned and controlled in that city. The history of the Union Pacific does not need to be recounted. It was built, when it was, wholly through the almost reckless energy of Oakes Ames ; and Oliver Ames was its first president. Its general offices were removed from New York to Boston in 1869. In 1872 the Atchison, Topeka, & Santa Fe was an incompleted enterprise, with a road two hundred and eighteen miles in length, extending from Atchison to Hutchinson in the western part of Kansas. At about that time it attracted the attention of certain leading business men of Boston, among whom were the banking firm of Kidder, Peabody, & Co., and Thomas and Joseph Nickerson. Obtaining control of the company, these gentlemen carried the road through to Pueblo in Colo¬ rado in 1876; and after the business revival, which took place two years later, the enterprise in their hands became one of the most brilliantly suc¬ cessful in the business history of the country. Joseph Nickerson had died in 1880, and the same year Thomas Nickerson retired from the presidency of the company, being succeeded by T. J. Coolidge. Kidder, Peabody, & Co. had disposed of their interest in 1878. The company's securities were, however, still held in greatest part in Boston hands, and the whole manage- ment of the property was there. In March, 1881, a connection of this road with the Southern Pacific was effected, and it thus became a portion of the second trans-continental line. At that time it owned, leased, or operated two thousand two hundred miles of track, representing over fifty millions of securities. The three combinations, - the Chicago, Burlington, & Quincy, the Union Pacific, and the Atchison, Topeka, & Santa Fe, - all of which in whole or greatest part originated in the private enterprise of Boston, and, having been constructed by the city's capital, were controlled from thence,

- represented in 1880 no less than ten thousand miles of railroad and three hundred and forty millions of securities. At the same time the nine corpo¬ rations owning railroads having independent termini in Boston itself con¬ trolled a little over seventeen hundred miles of track, represented by one hundred and twenty millions of securities. Much the larger Boston railroad development had thus been west of Chicago. The local Boston system

Of the influence which its railroad system, at home and abroad, exercised on the subsequent growth and municipal character of Boston but little needs to be said. In these respects the city's experience has been in no respect peculiar. And yet the subject cannot be dismissed without particular refer¬ ence; for here, as elsewhere, the year 1835 marked an historical dividing line. The world we now live in came into existence then ; and, humanly speaking, it is in almost every essential respect a different world from that lived in by the preceding six generations. Down to 1835 Boston was still the provincial New-England capital. So far as intercourse with Europe or with the interior was concerned, the motive power in use was the same that had been in use when in 1632 Winthrop first visited Plymouth. He then sailed across the bay to Weymouth, and on the return journey Governor Bradford loaned him his horse. So in 1835, except on interior waters, the sail and the horse were still the only agencies of commerce and travel. As respects population, Boston it is true had since the Revolution very consid¬ erably increased ; and the ancient form of town government had been laid aside. In all essential respects, however, the place was still only a large town. Territorially it was confined to the old natural limits, within which dwelt not the residents of the city alone, but those also who were regularly - engaged in business in it. The range even of country abode and summer resort was limited to neighboring towns, such as Roxbury, Brookline, Dor¬ chester, Cambridge, and Watertown, - now suburban, though then rural enough, - within the distance of an easy noon-day drive. Of modern sea¬ shore residence it may be said that there was almost actually none. The home had'to be near the place of business. The office or the countingroom, it is true, was no longer in the dwelling-house, but it was in some street conveniently near to it. Every one, too, had some calling by which he was at least supposed to earn a living; and to have none was looked upon as scarcely respectable. No generation had yet grown up accustomed to wealth from its birth ; there was no class of men of leisure. The railroad changed all this. It brought to Boston the full current of modern city life, - turning the large New-England town into a metropolis, if a provincial one. Of the rapid increase both in wealth and population which then ensued, the figures of the census tell the story. It would be foreign to the purpose to dwell upon it here. There is, however, another story which the census does not tell. In a quarter of a century after the three initial railroads were opened, both the ancient city limits and the modes of life traditionally pur¬ sued within them had disappeared. Boston had become the counting-house, as it were, - the daily business exchange, - of a vast concourse of active men having their homes in every neighboring town within a limit of thirty miles. The ancient municipalities immediately adjoining the city had been absorbed into it: Salem, Lynn, Lowell, Lawrence, and Worcester became its suburbs. Meanwhile business vocations not only diversified themselves, but they increased in volume, so as to lose all proportion with what they had been. New branches of industry came into existence, and their rapid growth soon caused them to overshadow the traditional callings which were insepa¬ rably associated in the New-England mind with the idea of accumulation. Down to the time when the three earliest Boston railroad lines were opened together in 1835, all the large fortunes, as they were then thought, had their origin in the fisheries, in the carrying trade, and in foreign commerce. Thenceforth these were to become of minor importance.

Men of a former generation thus found themselves puzzled. They saw change going on, and they mistook it for decay. Under the altered condi¬ tions, new points of distribution and new channels for reaching out from them came into being; and the old channels, and the branches of trade which had immemorially flowed in them, dwindled by degrees and then disappeared. Loreign commerce languished; sailing ships from Canton, from Calcutta, from Russia, from the Levant, and the west coasts of Africa and America no longer unloaded at the wharves. Grass seemed likely to grow in front of those warehouses, from the counting-room windows of which the old-fashioned merchants had been wont to look down on the decks of their vessels. Hence it came about that the period of Boston's most rapid growth was also the period in which the loudest and most dismal forebodings of the city's commercial decline were incessantly heard.

The whole of no community ever readily adapts itself to a far-reaching change of business conditions. In this case the interior of a continent was springing into civilized life. Those who could not realize the fact, or who from habit or slowness of perception were not in harmony with the new order of things, were ruined. Left stranded by the course of events, they disappeared. A wholly new America was meanwhile shaping itself, - an America with which the relations of Boston and New England were yet to be established. New York remained the financial centre of the whole ; but Chicago, in 1835 a mere out-post town on the shores of Lake Michigan, was transformed into the chief distributing point of an interior, in compari¬ son with which that region which the foreign trade of Boston once supplied, was lost in insignificance.1 Boston meanwhile developed into the local cen¬ tre of a busy manufacturing population dwelling and working in all eastern New England. This was its home function. As respects the new interior of the continent and foreign countries, the tendency of railroad development is to reduce all seaboard cities into being mere points of transshipment, - conduits, as it were, of modern trade. They are, indeed, of hardly more account in the process of distribution on this scale than those interior towns through which the freight trains laden with corn and meat pass rapidly on their way to the East, shortly to return carrying the bonded wares of Europe in their unbroken packages to the custom-houses of the West.

Between 1835 and 1880, then, the introduction of the railroad and the development of the railroad system, as it changed every other considerable city, changed Boston also. They changed it both within itself, and in its relations with other countries and other portions of the common country. The former capital of provincial New England had not become one of the great railroad centres of the continent. Geographical position alone probably put this out of the question. It had not, however, developed into nearly so considerable a railroad centre as it might at one time have been made. In this respect opportunities had been lost. Nevertheless, as a rail¬ road centre of the second class the position of Boston was well defined and considerable. Within its own territory the city was supreme; and that territory was populous, busy, and wealthy. Beyond its territory the railroad enterprise and railroad investments of those dwelling in Boston had sent back to it a tide of wealth, which reduced to insignificance the old-time profits. Meanwhile, so far as foreign commerce and a share in the handling of the great volume of commodities and exchanges passing between the interior and the ports of other nations are concerned, the city had much more than held its own, and its outlook for the future in 1880 was brighter than ever before in its history.

1 In 1820 the Board of Directors of Internal Boston more easily than to any other sea-port, Improvements stated in the report already re- and which can receive its foreign supplies from ferred to (see ante.), that "the tract of country thence most conveniently, contains a population which at present can carry its surplus produce to not exceeding 300,000 souls " (p. 44).

By Henry P. Kidder And Francis H. Peabody

J- and wealth necessarily includes the story of its connection with many undertakings of sufficient magnitude and importance to require separate treat¬ ment in other chapters of this work. Although shipping and the foreign trade in the early days, and in more recent times the manufacture of goods for the markets of the country, either in Boston or in other cities and towns of New England, and the construction and operation of railroads have given the greatest impetus to enterprise and the greatest additions to the wealth of the city, yet in this place a brief reference only can be made to the devel¬ opment of these enterprises. But if circumstances require that they shall seemingly occupy a subordinate place, it is necessary that their true impor¬ tance shall be recognized at the very outset.

Boston was from its foundation comparatively a rich and prosperous town. It was the political and trading centre of the colony, and, as the colonies grew into States, of New England. In these respects it was second only to Philadelphia in all the colonies during the Revolutionary period. When the first census of the United States was taken in 1790, the whole population of the country was a little short of four millions, of whom nearly or quite one fourth were directly dependent upon Boston as their financial and commercial capital. From an account1 written four years later, in 1794, we may obtain an excellent idea of the material condition of Boston just after the close of the Revolutionary War.2 The population at that time was about nineteen thousand. It had two banks, one of them already ten years old, chartered by the Commonwealth, besides a branch of the United States Bank ; some eighty wharves and quays, and a large domestic and foreign . trade. Ship-building had been carried on very extensively in former years, but had, at the date of Mr. Pemberton's writing, been for the most part transferred to other coast towns.3 There were at one time twenty-seven

The foundation of the financial strength which Boston has enjoyed in a peculiar degree during the last century was, without doubt, laid when the banking system was established. The usefulness of the modern instruments for economizing the use of money, by means of combination and concentra¬ tion of wealth, and for increasing its power by the same means, was recognized at a very early day. The wisdom, or the chance, which led the legislators of the last century to adopt measures which, while they encouraged such con¬ centration of wealth and energy, served to give security both to the owners of the capital of banks and to depositors in them, supplemented as it has been by a generally consistent adherence to conservative and correct prin¬ ciples of banking, have done more than anything else to give to Boston the rank as a financial centre which it enjoys, - a rank to which neither its position as a nucleus of population nor its situation with respect to the trade of the country would ever have conferred. The banks of Boston have been safe and strong at times when those of other cities have been weak. They have never led the way in a suspension of specie payments, nor have they ever been backward in resuming. Disasters among them have been rare, and seldom or never attended with serious consequences to sister institutions else¬ where, or to the commercial world. They have helped greatly in sustaining credit, both public and private ; and reciprocal assistance has been rendered to them in the shape of a strong public sentiment, which was as free from unreasonable jealousy of their power as it was from toleration of dangerous tendencies in banking.

A bank was established in Boston as early as 1689; but neither that nor any one of several successors during the following century had a long life, or was fortunate while it still existed.1 In March, 1782, the Bank of North America, founded in Pennsylvania, was chartered also by Massachusetts, and opened a branch in Boston. Although no record of the operations of this bank has been preserved, it is known that its success was sufficient to lead to the charter of a purely local bank in Boston two years later. This latter institution, the Massachusetts Bank, is still in a state of prosperous existence under a national charter. It began business on July 5, 1784, with an authorized capital of $300,000, of which $253,500 was paid in.2 The

1 [Professor W. G. Sumner's chapter on "Mon¬ etary Development," in The First Century of the Repziblic , cites as the chief contemporary author¬ ities on colonial matters of this kind two Boston books, - Hutchinson's Massachusetts Bay (very intelligent and correct on finance, he says), and Douglass's Summary (unequal but valuable, as he accounts it). He also esteems of great value a pamphlet published in Boston in 1740, Dis¬ course concerning the Currencies of the British Plantations. The reader who is curious to trace the instructive history of our currency in the pre- Revolutionary periods may find - beside Felt's

Historical Account of Massaclmsetts Currency, 1839, and the references noted in Vol. I. p. 354, and Vol. II. p. 467 - something of more or less advantage in the following : Mass. Hist. Soc. Proc., February, 1863, and April, 1S70 (by W. S. Ap¬ pleton) ; Amcr. Antiq. Soc. Coll., iii. 148; and Proceedings, March 16 and April 25, 1866; N. E. Hist, and Gencal. Reg., July, i860, p. 261. The story will serve as an illustrative commen¬ tary on the financial history of our own day, and needs to be well written. - Ed.]

Finance In Boston

rules 1 adopted for the management of its business were of the most strin¬ gent character, but were exceedingly wholesome in their operation, and the Massachusetts Bank secured a good amount of profitable business. The dividends fluctuated somewhat during the early years of its existence, but the average of the years 1791 and 1792 was sixteen per cent. Its assured success led, in the latter year, to the establishment of a rival, - the Union Bank; and about the same time a branch of the United States Bank was opened in Boston. The Union Bank was the first of a series of banks organized under charters having some peculiar provisions. Its capital was fixed at $1,200,000, of which one third was subscribed by the State in its corporate capacity. The bank was forbidden to issue any circulating notes for less than five dollars, or to owe more than twice its capital in addition to its deposits, - -the penalty for transgressing this last restriction being the personal liability of the directors for the excess. It was provided that one fifth of the bank funds should be appropriated to loans outside of Boston, for the benefit of agriculture, in sums not less than $100 or more than $1,000, secured by mortgages of real estate, and having not less than one year to run.2

Such was the origin of the system which not only rendered available the wealth of Boston merchants, but, becoming metropolitan, absorbed a large part of the banking reserves of New England, and thus made the surplus of the whole group of States helpful in carrying forward Boston enterprises.

At this time, and for many years afterward, Boston was chiefly a com¬ mercial port. The great fortunes that were made were acquired in the foreign trade, - like those of Russell, Phillips, Perkins, and others, and that of Mr. William Gray, who made his fortune as a Salem merchant, and then came to Boston to enjoy it. In the years from 1786, perhaps a little earlier, down to the time of the second war with Great Britain, the trade of Boston with China and the East Indies, and to a smaller degree with other coun¬ tries, was the distinguishing feature of the town's commercial enterprise. But there was another movement going on at the same time which exercised even then, and was destined in after years to exert to a greater extent, an influence upon the future of Boston. The very smallness of the area of the town, and its inaccessibility, served to open a field for financial activity and

1 The maximum loan to one person at one time was $3,000 ; no person was allowed to owe the bank more than $5,000 at the same time ; and $7,500 was the largest sum for which any person could be liable to the bank as promisor and endorser. Renewal of notes was absolutely forbidden. The person who failed to meet his note was not only obliged to submit to the im¬ mediate sale of his security, but he was denied the privilege of having any further notes discounted for a period of eight months thereafter, unless the penalty were remitted by a unanimous vote of the directors. The rules, which were " not to be deviated from in the smallest instance nor on any pretence whatever," also required that the names of delinquents should be posted in a conspicuous place in the bank.

2 Most of the subsequent charters of Boston banks, until the year 1816, contain provisions similar to these, with some variations in detail. The State subscription became an ordinary feature of the bank charter, so that in 1812 the Commonwealth owned about $1,000,000 in stock of its own corporations, being nearly one eighth of all the banking capital of the State. This stock was all disposed of a few years later.

speculation. Wharf property was more remunerative than almost any other kind of real estate, and vast sums for those times were invested in the filling

1 [Copley painted five likenesses of Mr. Jackson (Perkins's Copley's Life and Paintings, p. 78) : one, a life-size crayon of the head, belonging to Jackson's granddaughter, Mrs. Oliver Wendell Holmes; a second, painted in 1768, in oils, half-size, belongs to Mrs. Charles Upham of Salem; a third, half-length, painted in England, belongs to a granddaughter, Susan Cabot Jackson; a fourth, an oval picture, be¬ longs, with one of Mrs. Jackson, to Francis H. Jackson of Boston ; the last is a pastel (23 X 17 inches), owned by Colonel Henry Lee, a grandson, and by his kind permission is fol¬ lowed in our cut. It was painted between 1761 and 1773. The morning-gown is of green, with a crimson collar.

Mr. Jackson was the first president of the Boston Bank, holding office from April, 1803, till his death in 1810. The first board of direc¬ tors consisted of Thomas C. Amory, Samuel P. Gardner, Joseph Hall, Peter C. Brooks, Thomas Iv. Jones, James Lloyd, Jr., and James Perkins. The Editor is indebted to Colonel Lee for the following notice of Mr. Jackson: -

The Hon. Jonathan Jackson, descendant in the fourth generation from Edward Jackson, one of the first set¬ tlers of Cambridge, and afterwards of Newton, - "who brought a good estate to this town, and hath not been wanting to tile ministry, or any good work among us, " - and son of Edward Jackson (H. C. 1726) and Dorothy Quincy, was born in his father's house in Queen (now Court) Street, where Tudor's and a portion of Sears's Buildings now stand, June 4, 1743 ; graduated at Harvard in of docks and the construction of piers. At the beginning of this century, too, ideas of the. future greatness of Boston were strongly entertained by many of the wisest men of the town, and they took upon themselves the task of making preparations for the increase of business which they fore¬ saw. Among the enterprises of this period, which can be barely alluded to in this chapter, were the connection that was made by means of bridges with Cambridge, Charlestown, and South Boston, the cutting down of Beacon Hill, so as to fit it for purposes of residence, the annexation of South Bos¬ ton, and, later, the construction of the Mill-Dam, for the double use of a

College, 1761 ; moved afterwards to Newburyport, where he married Hannah, daughter of Patrick Tracy, Esq., an opulent merchant, and built by the side of the house of his friend Judge Lowell a splendid mansion, afterwards ren¬ dered absurd and notorious as "Lord" Timothy Dexter's house. Mr. Edward Jackson inherited ,£30,000 from his father, and increased it by commerce in partnership with his wife's brothers, Josiah and Edmund Quincy.

His son Jonathan, upon coming of age, received twenty thousand golden guineas. This and his wife's fortune were lost in commerce, or having been loaned to the Government were hence irrecoverable at the close of the Revolution, and from that time to his death he was dependent upon his salary. His public record is a long and honorable one : member of the Provincial Congress, 1775 ; representative, 1777; delegate to the Essex Convention, held in Ipswich, in 1778, whose report was the famous Essex Result ; dele¬ gate to the convention to frame a Constitution for Massa¬ chusetts, and one of a committee to draft one; member of the Old Congress, 1782; State Senator, 1789; appointed by Washington marshal of the district of Massachusetts, a position held till 1791 ; inspector, then supervisor of ex¬ cise, 1791-1802; treasurer of Massachusetts, 1802-1806; treasurer of Harvard College, 1807 till his death, March 5, 1810 ; also first president of the Boston Bank. He was one of the founders of the American Academy of Arts and Sciences, also of the Humane Society ; one of the founders and treasurer of the Society for the Promotion of Agri¬ culture. Caleb Cushing says of him : " He was one of the eminent Patriots of Essex during the Revolution and the early periods of our Constitutional history. He wrote some of the best political tracts of the day, etc." Theophilus Parsons, in his life of his father, the Chief- Justice, says : " From my boyhood I was accustomed to hear my father speak of him in terms which placed him before me as the embodiment of sound sense and absolute in¬ tegrity, etc." In the Memoir 0/ John Bromfield , he is thus spoken of : " Hon. Jonathan Jackson, the father of Mrs. Francis Cabot Lowell and Mrs. Henry Lee, a man dis¬ tinguished in his day for his many excellencies of head and heart. He was educated at Harvard College, Cambridge, and was one of the most accomplished and elegant speci¬ mens of old-school manners known among us, or, as was once said of him by a friend, in the words of Sir Walter : ' He was, indeed, a princely knight and courtly gentleman.' Quincy, in his History of Harvard University , thus al¬ ludes to him : " The Hon. Jonathan Jackson was elected his (Storer's) successor, and retained the office until his death, which occurred in March, 1810 ; on which occasion the Corporation passed a vote of sympathy with his friends and the public in the loss of a man of talents, integrity, amiable and courteous manners, who discharged the duties of Treas¬ urer and member of the Corporation with reputation to himself and distinguished utility to the University and the public." President Kirkland, writing to Josiah Quincy, April 12, 1810, notices the death of Mr. Jackson: "You have observed and know of the loss of Mr. Jonathan Jackson. A great loss So true, so upright, so amiable a spirit cannot take its flight without leaving a melancholy chasm."

Two incidents in the life of this gentleman illustrate his chivalric spirit. The first is narrated by the historian of Newton, and is singularly omitted in Livermore's book : "He took an early and zealous part in the Revolution, was an ardent friend of liberty, and the owner of a slave. Seeing his inconsistency, he placed on record in the Suf¬ folk Probate Office the following document, a noble testi¬ mony : -

" ' Know all men by these presents, that I, J. Jackson, of Newburyport, in the County of Essex, gentleman, in consideration of the impropriety I feel, and have long felt, in holding any person in constant bondage, - more especi¬ ally at a time when my country is so warmly contending for the liberty which every man ought to enjoy, - and having some time since promised my negro man Pomp that I would give him his freedom, and in further consideration of five shillings, paid me by said Pomp, I do hereby liber¬ ate, manumit, and set him free; and I do hereby remise and release unto said Pomp all demands of whatever na¬ ture I have against Pomp. In witness whereof I have hereunto set my hand and seal, this 19th June, 1776.

"This document is dated just two weeks before the glorious Declaration of Independence was issued, pro¬ claiming all men to be born free. Pomp enlisted in the army as Pomp Jackson, served through the War of the Revolution, and received an honorable discharge. He af¬ terwards settled in Andover, near a pond still known as Pomp's Pond."

The other incident exhibits the inviolability of his friend¬ ship, and the degree of his disinterestedness. Mr. Jackson, like many more, having lost his vast acquired and inherited fortune by capture of his ships and by loans to the Govern¬ ment during the war, was compelled to apply for an office to eke out his support. The evening before he was to leave home, his friend, General Lincoln, requested a private in¬ terview, and imparted his anxiety for the future, having come home from the war penniless, and expressed his de¬ sire to obtain the office of collector of the port of Boston. This was the office upon which Mr. Jackson had set his heart, but this did not affect his resolve. He went to New York, waited upon the President, and, after some days' attendance, was admitted to an interview. Washington, taking out his watch, said curtly : " I will give you, Sir, fifteen minutes." Mr. Jackson began to set forth General Lincoln's needs and claims, when he was peremptorily stopped by, " You need not tell me about General Lincoln, Sir." He then explained why he spoke in his behalf, and the interview ended without a word spoken for himself, and General Lincoln was appointed collector. Judge Charles Jackson, Dr. James Jackson, and Mr. Patrick Tracy Jackson, sons of Jonathan, occupied as large and as high a position in their respective professions and in the esteem of their neighbors as any three men who ever lived in Boston. - Ed.]

The enumeration of these undertakings shows that Boston was even then an enterprising town. The money accumulated by merchants was well em¬ ployed in improving and beautifying the place. That was before the time of foreign investments. There were no railroads to absorb accumulated earnings, no organized manufactures, no great corporate or municipal loans to serve as investments of trust funds. Even if there had been such, the time was now at hand when there was to be no large surplus for investment in any new enterprise. The first twenty years of the present century were trying times for business. The poverty caused by the war, aggravated by a wretchedly deranged currency, was soon increased by the interruption which the embargo and a second war gave to foreign commerce. Considering what that commerce was to Boston, - its life-blood almost, - the wonder is not that the suffering which was experienced was as great as it was, but that the evils of the time were so bravely borne and so speedily recovered from.2

Among those who devoted themselves at this time to the improvement of Boston with full faith in its future, none deserves more prominent notice or higher honor than Uriah Cotting. Mr. Cotting was the projector and the guiding spirit in nearly every enterprise involving the development of the town for business during the first twenty years of this century. He obtained the charter of the Broad Street Association, by which a large district, pre¬ viously covered with small, inconvenient, and dilapidated buildings, was made available for purposes of commerce. He also led the way in the Central Wharf and India Wharf improvements. He devised the opening of Brattle Street and Cornhill. He was the largest proprietor of the Wheeler's Point estate, through which Sea Street, now Federal Street, was extended. He was, moreover, a large owner of lands on and near Leverett Street, and at the Neck. He acquired property consisting of flats near Lewis Wharf, where he planned the Marginal Wharf speculation, which was substantially carried out a quarter of a century later under Mayor Quincy, when the new streets east of North (then Ann) Street, were laid out, and the long markethouse built. His greatest work, however, was the Mill-Dam, which he pro¬ jected, and of which he was the first engineer, but which he did not live to see finished. He died in 1819 of consumption.

Mr. Cotting deservedly enjoyed during his life a reputation second to that of no other citizen of Boston. Mr. N. I. Bowditch, in a notice of him, printed in the Boston Courier of May 27, 1852, a week after the death of Mr. Cotting's aged widow, said that he was " a man to whom Boston is more indebted than to any other of her citizens. His sagacity, enterprise, and public spirit were truly unrivalled. . . . He was a man of the strictest integrity, in whose talents and judgment the most unbounded confidence

1 [See Mr. Stanwood's chapter on "The To- - [See Mr. Hamilton A. Hill's chapter on pography and Landmarks of the last Hundred " The Trade, Commerce, and Navigation of Bos- Years." - Ed.] ton, 1780-1880," in the present volume. - Ed.]

was reposed, and had he lived would undoubtedly have become one of our wealthiest citizens." Mr. Bowditch relates that, supposing himself to be wealthy, he began the erection of a magnificent house on Beacon Street, "which would have been, even for our times, truly a palace; but non¬ intercourse and the embargo, followed by war with England, came on. Commerce was prostrated ; real estate declined in value ; rents fell off ; his own health began to fail." Under these circumstances Mr. Cotting not only ceased work on his house, but pulled down what he had built, and sold the land. At the time of his death the depression in all kinds of property was very great, and the sale of the equities which he held in a great number of estates brought but a small sum to the heirs.1

Unfortunate as was the influence of the disturbance preceding the war of 1812, and that of the war itself, upon commerce, and particularly upon the trade of Boston, there were some compensations. The story of those times, as it is to be gathered from the newspapers of the period, is amazingly be¬ clouded with much that is probably false and still more that is unquestion¬ ably untrue. New England was bitterly opposed to the embargo, and op¬ posed to the war even to the verge of unpatriotic selfishness. Its commerce was completely destroyed. What followed is not in the least degree sur¬ prising. Smuggling became common, and it was engaged in by wealthy and respectable men. Moreover, many rich prizes of war were brought into Boston. In this way the town became a most important centre of trade, and in fact almost the sole source of supply of certain classes of foreign goods that could not be legally admitted into the country at all. This traffic was nevertheless profitable to a few only, who made large fortunes while most of the people were suffering, with the rest of the country, from the effects of the war. Boston was, no doubt, as one historian of the times puts it, " the financial autocrat of the country."

In 1 8 1 1 , three years after the passage of the Embargo Act, the Demo¬ crats came into power in Massachusetts. One of the acts of Governor Gerry's Legislature was to charter a good Democratic bank. It was the State Bank, which is still in existence, and was intended as an offset to the two banks already established, which were run on Federal principles. It was designed also to be the financial agent of the Commonwealth. Feder¬ alists offered to pay $100,000 for a charter precisely similar, and the Demo¬ crats, in order to avoid the appearance of evil, laid upon the capital of the State Bank an annual tax of one half of one per cent, and rechartered the two already doing business, whose charters were about to expire. This judicious compromise restored peace, as well as the appropriate equilibrium of parties so far as banking was concerned ; but the political warfare was

1 Important pieces of land were sold for five twelve hundred and thirty, on forty-one streets or ten dollars over the mortgages upon them, and wharves, in all parts of Boston. So exten- Only a year or two later, real estate rose much sive was his ownership on Fort Hill, that a mere in value, and the purchasers gained handsome abstract of his conveyances there occupies fiftyprofits. The conveyances to and from Mr. Cot- eight folio pages, ting on the registries of Suffolk County number waged as hotly as ever. During the war loud complaints were made of the unpatriotic manner in which the capitalists and bankers ot Boston kept their purse-strings tightly drawn. Such complaints were, no doubt, justified to some extent ; but party rancor carried the accusation of disloyalty be¬ yond all bounds. In 1813 the currency was in a fearfully deranged con¬ dition. Boston, but to a still greater extent the western part of the State, was flooded with the notes of New York and Vermont banks. The banks of Boston, in order to keep themselves strong in those troubled times,

1 [The likeness herewith given follows a por¬ trait of the first president of the State Bank, painted by Stuart in 1S07, and owned by the Hon. William Gray. Mr. Gray was born at Lynn, June 27, 1750, and died at Boston, Nov. 25, 1825, and had the reputation of being the largest ship-owner in the country. He lived on Sum¬ mer Street, in the mansion previously occupied by Governor Sullivan, and built the wharf at the North End known as Gray's Wharf. He is said to have owned at one time sixty square-rigged vessels. Soon after his coming to Boston he was elected lieut.-governor on the ticket with Gover¬ nor Gerry, with whom he agreed in politics, and he was one of the few Boston merchants who sustained the embargo. During the war he had done much to promote the purposes of the administration. Drake's Landmarks of Boston , 201. - Ed.]

made but a small emission of notes. According to the returns made to the State, the four banks of the town had more than four and a half millions in specie in their vaults ; but their aggregate circulation was less than a mil¬ lion and a half. Foreign notes (that is, those that were issued out of Bos¬ ton), were at a discount of from three to five per cent. By a law passed in 1 8 io, any Massachusetts bank which refused to pay a note on demand was liable to pay to the holder two per cent a month until the note was re¬ deemed. By the same law, notes issued by banks beyond the limits of the State were made unbankable.

It was at this juncture that the New England Bank was chartered. Im¬ mediately upon beginning business it gave out that it would charge only the actual cost of sending foreign money home to the issuing bank and obtain¬ ing the specie, to any persons who might desire to avail themselves of the privilege. The result was that the discount on bills of Massachusetts banks out of Boston was at once reduced to one half of one per cent. The bank also sent home the notes of banks outside of the State. Notwithstanding the evident purpose of this policy, to restore order to the currency and to protect the merchants of Boston from loss, the suspicious politicians chose to put another interpretation upon it. They maintained that it was a part of a scheme to drain the country of specie, and to prevent those who were patriotic from contributing to the necessities of the government in the time of its peril. In January, 1814, the Legislature of Massachusetts received the memorial of the New England Bank, in which it was narrated that the bills of certain New York banks, amounting in the whole to the sum of $138,874, having been 'sent home for redemption, the specie having been received and loaded in three wagons and transported as far as Chester, the collector of New York had ordered the money back and deposited it in the Manhattan Bank of which he was a director. He assigned as a reason for this action that he suspected the money was to be sent to Canada. The General Court passed resolutions condemning the high-handed act, refer¬ ring the matter to the President of the United States, and demanding the removal of the offending officer. The specie was restored, but there is no evidence that the collector was even rebuked.

The historians generally have done less than justice to this city and State in their accounts of the War of 1812. Lossing, for example, not only adopts the unwarranted suspicion of the bank-director of New York, who was in a position to worry the New England Bank for requiring payment of the circulating notes of his bank, but actually generalizes upon it, and inti¬ mates that Boston was in the habit of sending money to Canada. He goes so far as to lay it to the account of Boston that British bills of exchange were sold in New York and Philadelphia. He says that the terms were made attractive so as to draw specie away from the patriotic cities, and thus he makes Boston responsible for the sins of other cities. It can be said, however, that if any sums at all were sent from Boston to the Provinces the evidence does not appear in the bank statements of the time. From 1811 to 1814 the holding of specie in the Boston banks increased from $830,829 to $5,466,659. In the latter year all the banks of the country except those of New England suspended specie payments, and consequently the banks of this section became the reservoir from which the whole country drew. Thus at the very time when the use of silver in illicit trade with the enemy was charged upon Boston, the stock of silver was increasing at a rapid rate.