Old Times on the Upper Mississippi
when I was second clerk, and which I have had before me in writing
this chapter. We used to tow one barge all the time--most of the
time two barges, and both boat and barges loaded to the water line,
both ways, nearly every trip.
Of course we sometimes missed it. We landed ten thousand sacks of
wheat at Prairie du Chien on one trip. Instead of a hundred and
fifty cabin passengers, she often carried three hundred, "sleeping
them" on the cabin floor three deep--at stateroom rates; and under
such conditions the fortunate winners of such a chance to get into
the promised land have risen up and called the whole outfit blessed,
when in fact it was the other thing. I have heard of other boats
claiming that they had to tow an extra barge to carry the money which
they took in on the trip. I have always thought that these men were
slightly overstating the case--but maybe not.
An item in one of the St. Paul papers of the time, states that the
"Excelsior" arrived from St. Louis November 20, 1852, with two
hundred and fifty cabin passengers, one hundred and fifty deck
passengers, and three hundred tons of freight. For which freight
she received "one dollar per hundred for any distance"; and the net
profits of the up trip on freight alone were over $8,000. For two
hundred and fifty cabin passengers she would receive $16 each, or
$4,000; for the deck passengers, $8 each, or $1,200. These sums added
to the $8,000 received for freight, would aggregate $13,200. The
"Excelsior" cost not to exceed $20,000--probably not over $16,000.
Two trips like this would build a better boat. As this was the last
trip of the season, she probably did not get such another. Under that
freight rate--"one dollar per hundred for any distance"--a shipment
of a hundred pounds from Prescott to Point Douglass, one mile,
would cost the shipper a dollar. There were possibilities in such
conditions.
Another item, also from a St. Paul paper, states that the "Lady
Franklin" arrived May 8, 1855, from Galena, with five hundred
passengers. She would accommodate a hundred and fifty cabin people,
ordinarily. Figure this trip down to the probabilities, and the net
result would be about as follows:
300 cabin passengers at $12 $3,600
200 deck passengers at $6 1,200
------
$4,800
Or, reversing it:
200 cabin passengers at $12 $2,400
300 deck passengers at $6 1,800
------
$4,200
The "Lady Franklin" cost about $20,000. Two months' work at this rate
would buy a new and better boat. If I remember aright, the "Lady
Franklin" was sunk in 1856 or 1857, but not until she had earned
money enough to buy two new boats, each costing twice as much as she
did. At the time she carried five hundred passengers she undoubtedly
carried a full cargo of freight, worth at least two thousand dollars
more to the boat.
An item in a St. Louis paper of that date, announces the departure of
the side-wheel steamer "Tishomingo" (Jenks, master), for St. Paul on
April 14, 1857, with 465 cabin passengers, 93 deck passengers and 400
tons of assorted freight. This trip would figure somewhat like this:
465 cabin passengers at an average of $16 $ 7,440.00
93 deck passengers at an average of $8 744.00
400 tons freight at 75c per hundred 6,000.00
---------
$14,184.00
These rates are estimated at a very low figure. The regular cabin
rate at that time, St. Louis to St. Paul, was, for cabin, $24; deck,
$12; freight, $1.50 per hundredweight. It is not necessary to amplify
at all. The "Tishomingo" had been bought in the spring of 1857,
within a month, for $25,000. She paid one-half her purchase price on
her first trip that season.
I would not have it understood that all boats made these phenomenal
earnings; but many boats did, and all those of the Minnesota Packet
Company were in this favored class. There were several conditions
precedent, which made these results possible with the boats of
this line. It controlled, absolutely, the freighting from the
Galena and Dubuque jobbing houses; it controlled, absolutely, the
freight business of the Dunleith and Prairie du Chien railroads,
and practically all the passenger business of the two roads, as
steamboat tickets were sold on the train, good only on the boats of
the Minnesota Packet Company. These conditions insured a full cargo
for every boat, and a full passenger list every trip. Outside boats
did not have such a "cinch", but each had a source of revenue of its
own, equally satisfactory. Even the "wild" boats had no difficulty
in getting cargoes, and every vessel in that busy era had all the
business it could handle.
The term "Company" was something of a misnomer. It was not at first
a stock company, in the modern sense of the word. Each boat was
owned by its captain, or a number of persons acting individually. In
organizing the company, instead of capitalizing it with a certain
amount of stock, the controlling parties simply put in their
steamboats and pooled their earnings. Each boat had an equal chance
with all the others for a cargo; and when the dividends were declared
each one shared according to the earnings of his boat. A big boat
could earn more than a smaller or slower one, and such a boat got a
larger percentage than the latter. The particular advantage, in fact
the only advantage, in pooling lay in securing a monopoly of the
railroad and jobbing business. In order to do this it was necessary
to have boats enough to handle the business at all times, and to have
a general manager who would place the craft so as to give the most
effective service.
One of the beauties of the pooling system was, that if a captain or
owner became dissatisfied and desired to pull out, he could take his
boat and the share of profits due him, and leave at any time. A few
years later the company was reorganized as a joint stock company.
After that, if one wished to get out he was lucky if he could get
clear with the clothes on his back. The financiers who controlled
fifty-one per cent of the stock retained all the steamboats and all
the profits.
Chapter XXII
_Wild-cat Money and Town-sites_
Both of these specimens of natural history were bred, nurtured, and
let loose in countless numbers to prey upon the people in the early
days that witnessed the opening of the Northwestern territories to
settlement. The wild-cat dollars waxed fat upon the blood and brawn
of the settlers who had already arrived; wild-cat town-sites found
ready victims in the thousands of Eastern people who desired to
better their fortunes, and who lent ready ears to the golden tales of
unscrupulous promoters, that told of wonderful cities in the West,
whose only reality was that blazoned in the prospectuses scattered
broadcast through the East.
The younger generation, whose only acquaintance with the circulating
symbols of wealth that we call "money", is confined to the decades
since the close of the War of Secession, can have no idea of the
laxity of banking laws of the fifties, in the Northwestern states and
territories, nor of the instability of the so-called "money" that
comprised nine-tenths of the medium of exchange then in use in the
West. Nowadays, a bank bill stands for its face value in gold, if it
be a National Bank issue. If a state bank--and bills of this sort
are comparatively few in these days--they are also guaranteed, in a
measure, by the laws of the state in which the bank is situated. In
the days of which I am writing, and especially in the unsettled and
troublesome times just before the war (from 1856 to 1862), the money
that was handled on the river in the prosecution of business, except
of course the small proportion of gold that was still in circulation,
had little or no backing, either by federal or state enactments.
A man went into an embryo city, consisting in that day of two or
three thousand town lots, and from fifty to a hundred inhabitants,
with an iron box costing twenty-five dollars. In this box he
had ten, twenty, or thirty thousand "dollars" in new bank bills
purporting to have been issued from two, three, or four banks doing
business in other equally large, populous, and growing cities,
situated elsewhere in Wisconsin, or preferably in Illinois, Indiana,
or Michigan. How did he become possessed of all this wealth? Was
it the savings of years? The iron box was, perhaps; perhaps he got
trusted for that. The money was not usually the savings of any time
at all; it was simply printed to order.
Five or six persons desirous of benefitting their fellow men by
assisting them in opening their farms and "moving their crops", would
get together in Chicago, Cincinnati, or St. Louis, wherever there was
an establishment capable of engraving and printing bank bills--and
not very elegant or artistic printing was required, or desired. These
men propose to start as many banks, in as many "cities" in the West.
They have money enough, each of them, to buy a safe, an iron box into
which any carpenter could bore with an ordinary brace and bit, and
enough over to pay for the printing of twenty thousand dollars' worth
of bills in denominations of one, two, five and ten dollars. The
printing finished, each man would sign his own bills as president,
and one of the others would add the final touch of authenticity by
signing a fictitious name to the same bills as cashier. Then it was
"money".
But it would have been overloading the credulity of even the most
gullible denizens of his adopted city to ask them to accept his own
bills as legal tender; so a swap was made all around, and when the
requisite amount of shuffling was completed, each man had his twenty
thousand dollars in bills on four or five banks, but none of his own
issue. There was a double incentive in this transaction: first, it
inspired the utmost confidence in the minds of the men who were to
borrow this money. How could this banker who had come among them for
their good, have acquired this money by any other than legitimate
transactions? If it were bills on his own bank that he proposed
to put into circulation, there might be some question as to their
guaranty; but he could not get this money by merely going to the
printing office and ordering it, as he might in case of bills on
his own institution. It certainly must be good money. Secondly, by
distributing his bills in as many different localities as possible,
the chances of its never being presented for redemption were greatly
multiplied; it might be burned, or lost overboard, or worn out, in
which case he would be just so much ahead, and no questions asked.
The foregoing may be a somewhat fanciful statement of the way in
which the bankers proceeded, but in essence it is a true picture.
They may not have all met in Chicago, or anywhere else, to perfect
these arrangements, but the arrangements were all perfected
practically as stated: "You put my bills into circulation, and I will
put out yours; and in each case the exchange will greatly assist each
and all of us in hoodwinking our victims into the belief that it is
money, and not merely printed paper which we are offering them".
Equipped with these goods, and with a charter from the state in which
he proposed to operate--a charter granted for the asking, and no
questions raised--the banker transports himself and his box of money