California Rich Page 13
Still, Stanford proceeded with his plans. The great landscape architect Frederick Law Olmsted, who had designed New York’s Central Park, was commissioned to design the campus. David Starr Jordan, a distinguished eastern educator, agreed to serve as the university’s first president. And when the university opened its doors on October 1, 1891, the first student to register was a young man named Herbert Hoover.
Notwithstanding these auspicious beginnings, there was trouble ahead. Two years later Leland Stanford died, and his estate was found to be seriously depleted. His battle with Huntington, it transpired, had cost him more than the presidency of the railroad. All at once, new contracts for the salaries of Stanford professors had to be amended to read “or as much of it as shall be available.” To the rescue came Stanford’s widow. While her husband was alive Jane Stanford had seemed a colorless figure, except for her jewelry collection. Now she emerged as a woman of energy and resourcefulness. She sued Collis P. Huntington to recover sums that, she claimed, he had wrongfully transferred from her late husband. She carried her case through the courts and ultimately received from the California Supreme Court a decision in her favor. She persuaded, one by one, all of the major American railroads to haul her private car without charge while she went on an extensive cross-country fund-raising tour. She trimmed her own expansive style of living and sold her big houses, turning over what she realized from the sales to the university. She journeyed to England to pay a personal call on Queen Victoria to see whether the queen might be interested in buying the famous Stanford jewelry collection. The queen was not, but Mrs. Stanford was able to sell her jewels, including the four sets of diamonds that had been Queen Isabella’s, elsewhere. The beneficiary of all this cash was the university.
Jane Lathrop Stanford had been the recipient of one of Eleanor Martin’s famous snubs. The Stanfords, Mrs. Martin had decreed, were “below the salt,” and they had not received invitations to the Bachelors’ Cotillion. Now Mrs. Stanford was proving herself to be by far the more important and influential lady. She even decided finally to bury the hatchet in the longstanding Stanford-Huntington feud. Not long before her death in 1905, according to Oscar Lewis in The Big Four, Jane Stanford presented herself in Collis P. Huntington’s office, held out her hand, and said, “Mr. Huntington, I have come to make my peace with you.” The flabbergasted Mr. Huntington took both her hands in his, sat her down in a chair, mopped his brow, and said, “Well, I declare!”
* Against today’s prices, the Mackays’ silver service was a bargain—it cost only $125,000.
CHAPTER TEN
Prince and Pauper
Among the disputatious members of San Francisco’s new-rich upper crust there was one couple who had an unusual distinction: practically everybody in San Francisco liked them. They were Mr. and Mrs. William Ralston. William Ralston was a six-foot-tall handsome Ohioan who had worked as a clerk on a Mississippi River steamboat, come to California in 1848 with all the others, invested in railroads, vineyards, and real estate, and in the 1850s, when he opened his Bank of California, had become one of the richest men in the city. Thanks to William Ralston, a number of other San Francisco families became rich through banking—the Breckenridges, Tevises, Newlandses, and the Millses, to name a few, most of whom were collaterally related to the man Ralston made richest of all, William Sharon. And yet, as a result of one of the most stunning instances of business treachery in the history of California, there was never to be a Ralston family fortune at all. In fact, William Ralston’s widow would be left without so much as a house to live in.
Ralston must certainly be classed among the robber barons of the era, but one tends to forgive him because he was such a pleasant man. He and his wife loved to entertain a hundred house guests at a time in their enormous house in suburban Belmont, and Ralston was notoriously generous with his money as well as his hospitality. He lent millions of dollars to friends and was known as the softest touch in town. He built the spectacular Palace Hotel in San Francisco, which had 800 rooms and was at the time the largest and most expensive hotel in the world. (It was much larger, actually, than San Francisco really needed—having then a population of only 200,000—but Ralston had faith in the city’s growth.) By the 1860s the press was calling William Ralston “the father of San Francisco.”
In 1864, William Sharon, down-and-out, drifted into town. Sharon was on the rebound from unsuccessful gold and silver speculations in Nevada, but his father-in-law knew William Ralston and took the mendicant to see the city’s famous Good Samaritan. It was a meeting that changed the destinies of both men. As he did most people, Ralston liked Sharon immediately and asked what he could do for him. Sharon replied that he needed a loan and a job.
He got both—$15,000 in cash and an assignment to conduct some bank business in Nevada. Will Sharon completed the mission successfully and returned to San Francisco, where he suggested to his new boss that the Bank of California open a Nevada branch. Ralston liked the idea, and presently Will Sharon was put in charge of the operation across the Sierra. Now Sharon was on his way. Since he was able to keep in closer touch with the diggings in and around Virginia City, his mining investments were now much more sophisticated than they had been before. Besides, he had the financial backing of Ralston’s Bank of California. Presently William Sharon’s investments were yielding him an income of two thousand dollars a day. Ralston placed more and more trust in Sharon’s judgments, and in the process the two men became, as far as could be discerned, the closest of personal friends. Among the most frequent guests at the Ralstons’ Belmont mansion were Mr. and Mrs. William Sharon.
Once Sharon had money, he decided to acquire some respectability, and, accordingly, he purchased a United States senatorship from the state of Nevada by bribing the Nevada legislature with shares of one of his silver stocks. This was a common practice, although at the time there were indications that Sharon’s manipulations were less than usually trustworthy. Once “elected” to the Senate, Sharon quietly sold his own shares of the stock, thereby driving the price down for all the others. The Nevada legislators were outraged, if clearly in no position to complain.
On August 26, 1875, there was a run on the Bank of California. Such occurrences were not at all uncommon. Whenever the volatile gold and silver markets fluctuated sharply, or when rumors of an important new strike circulated, depositors descended on the banks to withdraw cash for other investment. But the August 26 run was particularly heavy, and the bank was forced to close its doors half an hour early, leaving hundreds of customers outside the pseudo-Roman bank building on Montgomery Street still shouting and clamoring to get in. The run on his bank had come at a particularly bad time for William Ralston. He had been lending money to himself for his hotel as well as to support his own opulent lifestyle. The house of cards he had built out of his borrowing now seemed about to collapse, and the rumor in the financial community was that the Bank of California would never open its doors again. This seemed confirmed when, the following day, the bank remained closed.
That day, the twenty-seventh, William Ralston did two things. First, he drafted and signed a “deed of trust,” the purpose of which was to convey all his property, real and personal, to a trustee who, if all else failed, could use the instrument to reach a settlement with the bank’s creditors. The deed of trust would serve as a last-ditch form of insurance. The trustee named was William Sharon. Whether Sharon was privy to the details of this instrument at the time has never been clear; doubtless he was aware of its existence. In fact, it is possible that the deed of trust was prepared at Will Sharon’s suggestion. Next, around noon, Ralston called a meeting of his board of directors, which included Will Sharon, and grimly outlined the situation to them. He owed the bank four million dollars. He owed Sharon two million. And to a group of other creditors he owed something more than three and a half million. His own assets amounted to only four and a half million, less than half of what he owed. But Ralston urged calm. He had weathered other such panics and knew tha
t runs on banks were prompted primarily by emotional and psychological factors, the result of hysteria more than anything else. He asked for time. He suggested that the Bank of California remain closed for an indefinite period while it waited for the business climate to improve. Then the bank would open its doors again and proceed with business as usual. He asked his directors to have faith in him.
The directors listened to Ralston’s recital glumly. They then asked for a few minutes in which to consider the situation and requested that during their deliberations Mr. Ralston leave the room, which he did. William Sharon then leaped to his feet and demanded that Ralston be asked to step down. A vote was taken and a majority of the directors agreed. Then, although Sharon had initiated the vote, another director, Darius O. Mills, was delegated to bear the bad news. Mr. Ralston took his directors’ decision calmly. He penned a brief letter of resignation. Then he left his office and went directly to the Neptune swimming club at North Beach, where he often exercised, put on a bathing suit, and swam out into the Bay. Two hours later his dead body was carried ashore.
The immediate assumption was that he had committed suicide. But Ralston’s wife and family were not at all sure. Ralston, they said, had assured his wife the morning of his death that even if he should lose everything, he was ready to start all over again, that, if necessary, they would live on as little as a hundred dollars a month, as they had once done. After all, he was still in his prime. To be sure, the family said, the shock of Sharon’s betrayal at the board meeting coupled with the shock of the cold water of the Bay might have brought on a heart attack or stroke. But they did not think so. An autopsy revealed that there was no water in Ralston’s lungs, indicating that he had not drowned, and that there was “congestion” in his brain, indicating that he could have been suffocated. The New York Life Insurance Company agreed with Mrs. Ralston that there was no question of suicide and promptly paid the widow the benefits of a $65,000 policy.
Mr. Sharon is said to have reacted to his friend’s death in two quite different ways, both of them recorded in George D. Lyman’s Ralston’s Ring. According to one report: “‘All I have I owe to him [Sharon cried out] and to protect his name and memory I will spend every dollar of it.’ Suddenly Sharon laid his head upon the mantelpiece and sobbed like a child.” According to the other, he was much less grieved: Several days after Ralston’s death Sharon is said to have been approached by John Mackay. (Mackay himself might have had reason to feel guilty about Ralston’s death; two of his partners, Flood and O’Brien, had helped instigate the run on the bank by announcing a day or so earlier that they intended to withdraw their funds to start a bank of their own.) Mackay is said to have asked Sharon, “Couldn’t they revive him?” And Sharon is said to have replied, “For a few minutes I was afraid they would.”
Whatever the truth of the matter, the deed of trust provided that everything that had been Ralston’s was now William Sharon’s, to do with as he wished. And now that the Bank of California was his, Sharon took his late friend’s advice—and waited. A few weeks later the bank quietly opened its doors again. The atmosphere of panic that had existed in August was over, and the bank’s business of handling deposits and withdrawals proceeded quite normally. To the fickle press William Sharon was a hero, “the man who saved the Bank of California.” Though Ralston’s widow sued Sharon over the deed of trust, in an out-of-court settlement of her lawsuit she was persuaded to accept $250,000. That, plus her insurance money, was all she ever got.
CHAPTER ELEVEN
Wedding Bells
Perhaps as a result of Ned Greenway’s efforts to place the battling stars of San Francisco’s upper crust into some sort of fixed planetary system, by the turn of the century intermarriage among San Francisco’s wealthy families began to be surprisingly common, with marriages tending to take place “within the set.” The Newhalls married Spreckelses and O’Briens, the Metcalfs married Huntingtons, the Hendersons and Redingtons married Crockers, the Nickels married Morses (of the Code family), and the Meins married Nickels. To be sure, no Spreckels ever married a de Young, nor did a de Young marry a Hearst, nor did a Huntington ever marry a Stanford, but the Tobins married Fays and de Youngs, the Thieriots married Tobins and de Youngs, the Olivers married Fays, the Millers married members of the Folger family (of Folger’s coffee), and the Fays married Millers, Meins, and Tobins. Spreckelses married other Spreckelses.
Perhaps the most startling interclan marriage occurred within the Huntington family. Collis Huntington, like Leland Stanford, had spent much of his later life collecting residences. He had three large houses in California, a country home in Throgg’s Neck, New York, and a $250,000 “camp” in the Adirondacks when he decided that he also needed a New York City address. At the cost of several millions, an imposing pile was erected for him at the corner of Fifth Avenue and Fifty-seventh Street. When the New York house was completed, however, Huntington could not be persuaded to live in it, having begun to subscribe to the superstition that men built houses only in order to die in them. He had already begun to prepare for this eventuality by ordering for himself in New York’s Woodlawn Cemetery (for another $250,000) a huge marble mausoleum, an edifice that took eight years to construct. (When in the end Mr. Huntington moved into the mausoleum, his widow moved into the Fifth Avenue house. She used it periodically until her own death in 1925, when the property was sold for $3,800,000 and razed to make way for a commercial building.)
Huntington had been married twice. His first wife, the former Elizabeth Stoddard, was so shy and retiring that for years San Francisco was not sure whether Huntington had a wife or not. They had no children, but adopted a daughter, Clara Prentice, who was the daughter of Mrs. Huntington’s dead sister. When the first Mrs. Huntington died, Huntington—with what seemed like unseemly speed—married again, this time a pretty widow named Arabella Worsham. Again there were no natural children, but the Huntingtons adopted the new Mrs. Huntington’s son by her previous marriage. Thus Collis P. Huntington became the legal father of his first wife’s niece and his own stepson. When Huntington died, a large share of his estate went to his widow, and some two million dollars was bequeathed to the adopted Clara. A much larger sum, however, was willed to Huntington’s favorite nephew, Henry E. Huntington, the son of Collis Huntington’s older brother, Solon Huntington.
Henry Huntington had in the meantime married Mary Alice Prentice, the sister of his uncle’s adopted daughter, thus turning two sisters into cousins by marriage as well, and making Clara Prentice Huntington’s stepmother her aunt. The complicated, near-incestuous Huntington family relationships seemed about to fall apart when Henry and Mary Alice Huntington were divorced. But the centrifugal forces were contained when Henry Huntington then married his uncle Collis’ widow. This had the effect of consolidating two large shares of Collis Huntington’s fortune, as well as turning Henry Huntington’s ex-wife’s sister into his own stepdaughter. “It is all,” said Henry Huntington at the time, “perfectly legal.” It did, however, make sorting out the kinships within the Huntington family something of a chore. And if Henry Huntington and Arabella Huntington Huntington had had offspring (which they did not), their children’s mother would have also been their great-aunt, and their father their second cousin. (San Francisco’s upper-crust Jewish families were equally intramural when it came to marriage. Two Neustadter brothers, Jacob and David, married two sisters, Dora and Josephine Dannenberg. Daniel Koshland married his first cousin, Eleanor Haas, of the Levi Strauss family, and went to work for the company that gave the world blue jeans.)
When the second-generation members of California’s new-rich families were not marrying each other they were scouring the capitals of Europe in search of titles to marry. The second generation had discovered two sad and interrelated facts: first, that when one had “arrived” in a city such as San Francisco, there was hardly any place to go, and second, that as far as New York was concerned, Californians might be rich but they had no class. An invitation to Ned Greenway�
�s cotillion might mark the capstone to a social career in San Francisco, but it meant nothing to Mrs. Astor, whose doors remained closed to Californians. Once again Californians looked abjectly to the East for inspiration and instruction on how to glide out of the cocoon of San Francisco and into the glittering world of the international butterflies.
One thing was quite clear about Caroline Astor: she loved titles. A count, archduke, prince, or earl immediately found himself invited to her house. Even an undistinguished British baronet was included in her original list of four hundred by virtue of the fact that his name was Sir Roderick Cameron. If Californians could acquire titles through marriage, then perhaps they could be accepted, not only in Europe, where, if the Mackays were an example, it was easy, but, so much more important, in the East.
The American vogue of exchanging American-made fortunes for European coronets is sometimes said to have started with Jennie Jerome, the daughter of a New York stockbroker, who married Lord Randolph Churchill in 1874, but actually this sort of thing had been going on for some time on the East Coast. In 1798, Anna Louise Bingham, the daughter of a wealthy Philadelphia merchant, married Alexander Baring, later to become Lord Ashburton. A few years later her sister Maria, not to be outdone, eloped at the age of fifteen and married the Count de Tilly. In 1824, Elizabeth Astor (daughter of the first John Jacob) had married Count Vincent Rumpff. Following Jennie Jerome’s example, a number of other American heiresses had made titled marriages. Consuelo Vanderbilt married the Duke of Marlborough; Jay Gould’s daughter Anna married, first, Count Paul Ernest Boniface de Castellane and, second, the count’s cousin, the Due de Talleyrand-Périgord. Alice Thaw of Pittsburgh married the Earl of Yarmouth. True, not many of these marriages worked out very happily for the women involved, and in nearly every case they cost the women—or their parents—considerable sums of money.