THE GROWTH OF THE ASTOR FORTUNE
While at the outposts, and in the depths, of the Western wilderness an
armed host was working and cheating for Astor, and, in turn, being
cheated by their employer; while, for Astor's gain, they were violating
all laws, debauching, demoralizing and beggaring entire tribes of
Indians, slaying and often being themselves slain in retaliation, what
was the beneficiary of this orgy of crime and bloodshed doing in New
York?
For a long time he lived at No. 223 Broadway in a large double house,
flanked by an imposing open piazza supported by pillars and arches. In
this house he combined the style of the ascending capitalist with the
fittings and trappings of the tradesman. It was at once residence,
office and salesroom. On the ground floor was his store, loaded with
furs; and here one of his sons and his chief heir, William B. could be
seen, as a lad, assiduously beating the furs to keep out moths. Astor's
disposition was phlegmatic and his habits were extremely simple and
methodical. He had dinner regularly at three o'clock, after which he
would limit himself to three games of checkers and a glass of beer. Most
of his long day was taken up with close attention to his many business
interests of which no detail escaped him. However execrated he might be
in the Indian territories far in the West, he assumed, and somewhat
succeeded in being credited with, the character of a patriotic,
respectable and astute man of business in New York.
ASTOR SUPERIOR TO LAW.
During (taking a wide survey) the same series of years that he was
directing gross violations of explicit laws in the fur-producing
regions--laws upon the observance of which depended the very safety of
the life of men, women and children, white and red, and which laws were
vested with an importance corresponding with the baneful and bloody
results of their infraction--Astor was turning other laws to his
distinct advantage in the East. Pillaging in the West the rightful and
legal domain, and the possessions, of a dozen Indian tribes, he, in the
East, was causing public money to be turned over to his private treasury
and using it as personal capital in his shipping enterprises.
As applied to the business and landowning class, law was notoriously a
flexible, convenient, and highly adaptable function. By either the tacit
permission or connivance of Government, this class was virtually, in
most instances, its own law-regulator. It could consistently, and
without being seriously interfered with, violate such laws as suited its
interests, while calling for the enactment or enforcement of other laws
which favored its designs and enhanced its profits. We see Astor
ruthlessly brushing aside, like so many annoying encumbrances, even
those very laws which were commonly held indispensable to a modicum of
fair treatment of the Indians and to the preservation of human life.
These laws happened to conflict with the amassing of profits; and always
in a civilization ruled by the trading class, laws which do this are
either unceremoniously trampled upon, evaded or repealed.
For all the long-continued violations of law in the West, and for the
horrors which resulted from his exploitation of the Indians, was Astor
ever prosecuted? To repeat, no; nor was he disturbed even by such a
triviality as a formal summons. Yet, to realize the full enormity of
acts for which he was responsible, and the complete measure of immunity
that he enjoyed, it is necessary to recall that at the time the
Government had already begun to assume the role of looking upon the
Indians as its wards, and thus of theoretically extending to them the
shield of its especial protection. If Government allowed a people whom
it pleased to signify as its wards to be debauched, plundered and slain,
what kind of treatment could be expected for the working class as to
which there was not even the fiction of Government concern, not to
mention wardship?
LAW BREAKERS AND LAW MAKERS.
But when it came to laws which, in the remotest degree, could be used or
manipulated to swell profits or to buttress property, Astor and his
class were untiring and vociferous in demanding their strict
enforcement. Successfully ignoring or circumventing laws objectionable
to them, they, at the same time, insisted upon the passage and exact
construction and severe enforcement of laws which were adjusted to their
interests. Law breakers, on the one hand, they were law makers on the
other. They caused to be put in statute, and intensified by judicial
precedent, the most rigorous laws in favor of property rights. They
virtually had the extraordinary power of choosing what laws they should
observe and what they should not. This choice was invariably at the
expense of the working class. Law, that much-sanctified product, was
really law only when applied to the propertyless. It confronted the poor
at every step, was executed with summary promptitude and filled the
prisons with them. Poverty had no choice in saying what laws it should
obey and what it should not. It, perforce, had to obey or go to prison;
either one or the other, for the laws were expressly drafted to bear
heavily upon it.
It is illustrative, in the highest degree, of the character of
Government ruled by commercial interests, that Astor was allowed to
pillage and plunder, cheat, rob and (by proxy) slaughter in the West,
while, in the East, that same Government extended to him, as well as to
other shippers, the free use of money which came from the taxation of
the whole people--a taxation always weighted upon the shoulders of the
worker. In turn, this favored class, either consciously or
unconsciously, voluntarily or involuntarily, cheated the Government of
nearly half of the sums advanced. From the foundation of the Government
up to 1837, there were nine distinct commercial crises which brought
about terrible hardships to the wage workers. Did the Government step in
and assist them? At no time. But during all those years the Government
was busy in letting the shippers dig into the public funds and in being
extremely generous to them when they failed to pay up. From 1789 to 1823
the Government lost more than $250,000,000 in duties,[90] all of which
sum represented what the shippers owed and did not, or could not, pay.
And no criminal proceedings were brought against any of these
defaulters.
This, however, was not all that the Government did for the favored,
pampered class that it represented. Laws were severe against labor-union
strikes, which were frequently judicially adjudged conspiracies.
Theoretically, law inhibited monopoly, but monopolies existed, because
law ceases to be effective law when it is not enforced; and the
propertied interests took care that it was not enforced. Their own class
was powerful in every branch of Government. Furthermore, they had the
money to buy political subserviency and legal dexterity. The $35,000
that Astor paid to Cass, the very official who, as Secretary of War, had
jurisdiction over the Indian tribes and over the Indian trade, and the
sums that Astor paid to Benton, were, it may well be supposed, only the
merest parts of the total sums that he disbursed to officials and
politicians, high and low.
ASTOR'S MONOPOLIES.
Astor profited richly from his monopolies. His monopoly of furs in the
West was made a basis for the creation of other monopolies. China was a
voracious and highly profitable market for furs. In exchange for the
cargoes of these that he sent there, his ships would be loaded with teas
and silks. These products he sold at exorbitant prices in New York. His
profits from a single voyage sometimes reached $70,000; the average
profits from a single voyage were $30,000. During the War of 1812-15 tea
rose to double its usual price. Astor was invariably lucky in that his
ships escaped capture. At one period he was about the only merchant who
had a cargo of tea in the market. He exacted, and was allowed to exact,
his own price.
Meanwhile, Astor was setting about making himself the richest and
largest landowner in the country. His were not the most extensive land
possessions in point of extent but in regard to value. He aimed at being
a great city, not a great rural, landlord. It was estimated that his
trade in furs and associated commerce brought him a clear annual revenue
of about two million dollars. This estimate was palpably inadequate. Not
only did he reap enormous profits from the fur trade, but also from
banking privileges in which he was a conspicuous factor.
It was on one of his visits to London, so the recital goes, that he
first became possessed of the idea of founding an extraordinarily rich
landed family. He admired, it is told, the great landed estates of the
British nobility, and observed the prejudice against the caste of the
trader and the corresponding exalted position of the landowner. Whether
this story is true or not, it is evident that he was impressed with the
increasing power and the stability of a fortune founded upon land, and
how it radiated a certain splendid prestige. The very definition of the
word landlord--lord of the soil--signified the awe-compelling and
authoritative position of him who owned land--a definition heightened
and enforced in a thousand ways by the laws.
The speculative and solid possibilities of New York City real estate
held out dazzling opportunities gratifying his acquisitiveness for
wealth and power--the wealth that fed his avarice, and the power flowing
from the dominion of riches.
ASTOR NOT AN EXCEPTION.
It may here be observed that Astor's methods in trade or in acquiring of
land need not be indiscriminately condemned as an exclusive mania. Nor
should they be held up to the curiosity of posterity as a singular and
pernicious exhibition, detached from his time and generation, and
independent of them. Again and again the facts disclose that men such as
he were merely the representative crests of prevailing commercial and
political life. Substantially the whole propertied class obtained its
wealth by methods which, if not the same, had a strong relationship. His
methods differed nowise from those of many cotton planters of the South
who stole, on a monstrous scale,[91] Government land and then with the
wealth derived from their thefts, bought negro slaves, set themselves up
in the glamour of a patriarchal aristocracy and paraded a florid display
of chivalry and honor. And it was this same grandiose class that
plundered Whitney of the fruits of his invention of the cotton-gin and
shamelessly defrauded him.[92]
Far more flagrant, however, were the means by which other Southern
plantation owners and business firms secured landed estates in Alabama,
Georgia and in other States. Their methods in expropriating the
reservations of such Indian tribes as the Creeks and Chickasaws were not
less fraudulent than those that Astor used elsewhere. They too, those
fine Southern aristocrats, debauched Indian tribes with whisky, and
after swindling them of their land, caused the Government to remove them
westward. The frauds were so extensive, and the circumstances so
repellant, that President Andrew Jackson, in 1833, ordered an
investigation. From the records of this investigation,--four hundred and
twenty-five solid pages of official correspondence--more than enough
details can be obtained.[93]
WHERE WAS FRAUD ABSENT?
In Wisconsin the most valuable Government lands, containing rich
deposits of lead and other mineral ore, were being boldly appropriated
by force and fraud. The House Committee on Public Lands reported on
December 18, 1840, that with the connivance of local land agents, these
lands, since 1835, had been sold at private sale before they were even
subject to public entry.[94] "In consequence of which," the Committee
stated, "many tracts of land known to be rich and valuable mineral lands
for many years, and known to be such at the time of the entry, have been
entered by evil-minded persons, who have falsely made, or procured
others to make, the oath required by the land offices. Honest men have
been excluded from the purchase of these lands, while the dishonest and
unscrupulous have been permitted to enter them by means of false oath
and fraud."[95]
These are but the merest glimpses of the widespread frauds in seizing
land, whether agricultural, timber or mineral. What of the mercantile
importers, the same class that the Government so greatly favored in
allowing it long periods in which to pay its customs duties? It was
defrauding the Government on the very importations on which it was
extended long-time credit for customs payments. The few official reports
available clearly indicate this. Great frauds were continuously going on
in the importations of lead.[96] Large quantities of sugar were imported
in the guise of molasses which, it was discovered, after being boiled a
few minutes, would produce an almost equal weight in brown sugar.[97]
Doubtless similar frauds were being committed in other lines of
importations. Between the methods of these divisions of the capitalist
class, and those of Astor, no basic difference can be discerned.
Neither was there any essential difference between Astor's methods and
those of the manufacturing capitalists of the North who remorselessly
robbed Charles Goodyear of the benefits of his discovery of vulcanized
rubber and who drove him, after protracted litigation, into insolvency,
and caused him to die loaded down with worries and debts, a broken-down
man, at the age of 60.[98] As for that pretentious body of gentry who
professed to spread enlightenment and who set themselves high and
solemnly on a pinnacle as dispensers of knowledge and molders of public
opinion--the book, periodical and newspaper publishers--their methods at
bottom were as fraudulent as any that Astor ever used. They mercilessly
robbed and knew it, while making the most hypocritical professions of
lofty motives. Buried deep in the dusty archives of the United States
Senate is a petition whereon appear the signatures of Moore, Carlyle,
the two Disraelis, Milman, Hallam, Southey, Thomas Campbell, Sir Charles
Lyell, Bulwer Lytton, Samuel Rogers, Maria Edgeworth, Harriet Martineau
and other British literary luminaries, great or small. In this petition
these authors, some of them representing the highest and finest in
literary, philosophical, historical, and scientific thought and
expression, implore Congress to afford them protection against the
indiscriminate theft of their works by American booksellers. Their
works, they set forth, are not only appropriated without their consent
but even contrary to their expressed desire. And there is no redress.
Their productions are mutilated and altered, yet their names are
retained. They instance the pathetic case of Sir Walter Scott. His works
have been published and sold from Maine to the Gulf of Mexico, yet not a
cent has he received. "An equitable remuneration," they set forth,
"might have saved his life, and would, at least have relieved his
closing years from the burdens of debts and destructive toils."[99]
How fares this petition read in the United States Senate on February 2,
1837? The booksellers, magazine, periodical and newspaper publishers
have before succeeded in defeating one copyright bill. They now bestir
themselves again; the United States Senate consigns the petition to the
archives; and the piracy goes on as industriously as ever.
LEGALIZED PIRACY IN ALL BRANCHES OF TRADE.
What else could be expected from a Congress which represented the
commercial and landholding classes? No prodding was needed to cause it
to give the fullest protection to possessions in commerce, land and
negro slaves; these were concrete property. But thought was not
capitalized; it was not a manufactured product like iron or soap.
Nothing can express the pitying contempt or the lofty air of
patronization with which the dominant commercial classes looked down
upon the writer, the painter, the musician, the philosopher or the
sculptor. Regarding these "sentimentalists" as easy, legitimate and
defenseless objects of prey, and as incidental and impractical
hangers-on in a world where trade was all in all, the commercial classes
at all times affected a certain air of encouragement of the fine arts,
which encouragement, however, never attempted to put a stop to piracies
of publication or reproduction. How sordidly commercial that era was, to
what extremes its standards went, and how some of the basest forms of
theft were carried on and practically legalized, may be seen by the fate
of Peter Cardelli's petition to Congress. Cardelli was a Roman sculptor,
residing in the United States for a time. He prays Congress in 1820 to
pass an act protecting him from commercial pirates who make casts and
copies of his work and who profit at his expense. The Senate Committee
on Judiciary, to whom the petition is referred, rejects the plea. On
what ground? Because he "has not discovered any new invention on which
he can claim the right."[100] Could stupidity go further?
All of the confluent facts of the time show conclusively that every
stratum of commercial society was permeated with fraud, and that this
fraud was accepted generally as a routine fixture of the business of
gathering property or profits. Astor, therefore, was not an isolated
phenomenon, but a typically successful representative of his time and
of the methods and standards of the trading class of that time.
Whatever in the line of business yielded profits, that act, whether
cheating, robbing or slaughtering, was justified by some sophistry or
other. Astor did not debauch, spoliate, and incite slaughter because he
took pleasure in doing them. Perhaps--to extend charitable judgment--he
would have preferred to avoid them. But they were all part of the
formulated necessities of business which largely decreed that the
exercise of humane and ethical considerations was incompatible with the
zealous pursuit of wealth.
In the wilderness of the West, Astor, operating through his agents,
could debauch, rob and slay Indians with impunity. As he was virtually
the governing body there, without fear of being hindered, he thus could
act in the most high-handed, arbitrary and forcible ways. In the East,
however, where law, or the forms of law, prevailed, he had to have
recourse to methods which bore no open trace of the brutal and
sanguinary. He had to become the insidious and devious schemer, acting
through sharp lawyers instead of by an armed force. Hence in his Eastern
operations he made deception a science and used every instrument of
cunning at his command. The result was precisely the same as in the
West, except that the consequences were not so overt, and the
perpetration could not be so easily distinguished. In the West, death
marched step by step with Astor's accumulating fortune; so did it in the
East, but it was not open and bloody as in the fur country. The
mortality thus accompanying Astor's progress in New York was of that
slow and indefinite, but more lingering and agonizing, kind ensuing from
want, destitution, disease and starvation.
Astor's supreme craft was at no time better shown than by the means by
which he acquired possession of an immense estate in Putnam County, New
York. During the Revolution, a tract consisting of 51,012 acres held by
Roger Morris and Mary his wife, Tories, had been confiscated by New York
State. This land, it is worth recalling, was part of the estate of
Adolphus Phillips, the son of Frederick who, as has been set forth,
financed and protected the pirate Captain Samuel Burgess in his
buccaneer expeditions, and whose share of the Burgess' booty was
extremely large.[101] Mary Morris was a descendant of Adolph Phillips
and came into that part of the property by inheritance. The Morris
estate comprised nearly one-third of Putnam County. After confiscation,
the State sold the area in parts to various farmers. By 1809 seven
hundred families were settled on the property, and not a shadow of a
doubt had ever been cast on their title. They had long regarded it as
secure, especially as it was guaranteed by the State.
A NOTED LAND TRANSACTION.
In 1809 a browsing lawyer informed Astor that those seven hundred
families had no legal title whatever; that the State had had no legal
right to confiscate the Morris property, inasmuch as the Morrises held a
life lease only, and no State could ever confiscate a life lease. The
property, Astor was informed, was really owned by the children of the
Morris couple, to whom it was to revert after the lease of their parents
was extinguished. Legally, he was told, they were as much the owners as
ever. Astor satisfied himself that this point would hold in the courts.
Then he assiduously hunted up the heirs, and by a series of strategic
maneuvers worthy of the pen of a Balzac, succeeded in buying their
claim for $100,000.
In the thirty-three years which had elapsed since confiscation, the land
had been greatly improved. Suddenly came a notification to these
unsuspecting farmers that not they, but Astor, owned the land. All the
improvements that they had made, all the accumulated standing products
of the thirty-three years' labor of the occupants, he claimed as his, by
virtue of the fact that, in law, they were trespassers. Dumfounded, they
called upon him to prove his claim. Whereupon his lawyers, men saturated
with the terminology and intricacies of legal lore, came forward and
gravely explained that the law said so and so and was such and such and
that the law was incontestible in support of Astor's claim. The
hard-working farmers listened with mystification and consternation. They
could not make out how land which they or their fathers had paid for,
and which they had tilled and improved, could belong to an absentee who
had never turned a spade on it, had never seen it, all simply because he
had the advantage of a legal technicality and a document emblazoned with
a seal or two.
THE PUBLIC UPROAR OVER ASTOR'S CLAIM.
They appealed to the Legislature. This body, influenced by the public
uproar over the transaction, refused to recognize Astor's title. The
whole State was aroused to a pitch of indignation. Astor's claim was
generally regarded as an audacious piece of injustice and robbery. He
contended that he was not subject to the provision of the statute
directing sales of confiscated estates which provided that tenants could
not be dispossessed without being paid for improvements. In fine, he
claimed the right to evict the entire seven hundred families without
being under the legal or moral necessity of paying them a single cent
for their improvements. In the state of public temper, the officials of
the State of New York decided to fight his claim. Astor offered to sell
his claim to the State for $667,000. But such was the public outburst at
the effrontery of a man who had bought what was virtually an extinct
claim for $100,000, and then attempting to hold up the State for more
than six times that sum, that the Legislature dared not consent.
The contention went to the courts and there dragged along for many
years. Astor, however, won his point; it was decided that he had a valid
title. Finally in 1827 the Legislature allowed itself[102] to
compromise, although public opinion was as bitter as ever. The State
gave Astor $500,000 in five per cent stock, specially issued, in
surrender of his claim.[103] Thus were the whole people taxed to buy, at
an exorbitant price, the claim of a man who had got it by artifice and
whose estate eventually applied the interest and principal of that stock
to buying land in New York City. Thus also can a considerable part of
the Astor fortune be traced to Adolphus Phillips, son of Frederick, the
partner, protector and chief spoil-sharer of Captain Burgess, sea
pirate, and whose estate, the Phillips manor, had been obtained by
bribing Fletcher, the royal governor.
But while Astor gradually appropriated vast tracts of land in
Wisconsin, Missouri, Iowa and other parts of the West, and levied his
toll on one-third of Putnam County, it was in New York City that he
concentrated the great bulk of his real estate speculations. To buy
steadily on the scale that he did required a constant revenue. This
revenue, as we have seen, came from his fur trading methods and
activities and the profits and privileges of his shipping. But these
factors do not explain his entire agencies in becoming a paramount
landocrat. One of these was the banking privilege--a privilege so
ordained by law that it was one of the most powerful and insidious
suctions for sapping the wealth created by the toil of the producers,
and for enriching its owners at a most appalling sacrifice to the
working and agricultural classes. And above all, Astor in common with
his class, made the most valuable asset of Law, whether exploiting the
violation, or the enforcement, of it.
If we are to accept the superficial, perfunctory accounts of Astor's
real estate investments in New York City, then he will appear in the
usual eulogistic light of a law-loving, sagacious man engaged in a
legitimate enterprise. The truth, however, lies deeper than that--a
truth which has been either undiscerned or glossed over by those
conventional writers who, with a panderer's instinct, give a
wealth-worshipping era the thing it wants to read, not what it ought to
know. Although apparently innocent and in accord with the laws and
customs of the times, Astor's real estate transactions were inseparably
connected with consecutive evasions, trickeries, frauds and violations
of law. Extraordinarily favorable as the law was to the propertied
classes, even that law was constantly broken by the very classes to whom
it was so partial.
Simultaneously, while reaping large revenues from his fur trade among
the Indians in both the East and West, Astor was employing a different
kind of fraud in using the powers of city and State government in New
York in obtaining, for practically nothing, enormously valuable grants
of land and other rights and privileges which added to the sum total of
his growing wealth.
CORRUPT GRANTS OF CITY LAND.
In this procedure he was but doing what a number of other contemporaries
such as Peter Goelet, the Rhinelanders, the Lorillards, the
Schermerhorns and other men who then began to found powerful landed
families, were doing at the same time. The methods by which these men
secured large areas of land, now worth huge sums, were unquestionably
fraudulent, although the definite facts are not as wholly available as
are, for instance, those which related to Fletcher's granting vast
estates for bribes in the seventeenth century, or the bribery which
corrupted the various New York legislatures beginning in the year 1805.
Nevertheless, considering the character of the governing politicians,
and the scandals that ensued from the granting and sales of New York
City land a century or more ago, it is reasonably certain that corrupt
means were used. The student of the times cannot escape from this
conclusion, particularly as it is borne out by many confirming
circumstances.
New York City, at one time, owned a very large area of land which was
fraudulently granted or sold to private individuals. Considerable of
this granting or selling was done during the years when the corrupt
Benjamin Romaine was City Controller. Romaine was so badly involved in a
series of scandals arising from the grants and corrupt sales of city
land, that in 1806 the Common Council, controlled by his own party, the
Tammany machine, found it necessary to remove him from the office of
City Controller for malfeasance.[104] The specific charge was that he
had fraudulently obtained valuable city land in the heart of the city
without paying for it. Something had to be done to still public
criticism, and Romaine was sacrificed. But, in fact, he was far from
being the only venal official concerned in the current frauds. These
frauds continued no matter which party or what set of officials were in
power. Several years after Romaine was removed, John Bingham, a powerful
member of the Aldermanic Committee on Finance, which passed upon and
approved these various land grants, was charged by public investigators
with having caused the city to sell to his brother-in-law land which he
later influenced the city administration to buy back at an exorbitant
price. Spurred by public criticism the Common Council demanded its
reconveyance.[105] It is more than evident--it is indisputable--from the
records and the public scandals, that the successive city
administrations were corruptly conducted. The conservative newspaper
comments alone of the period indicate this clearly, if nothing else
does.
A PROCESS OF SPOLIATION.
Neither Astor nor Goelet were directly active members of the changing
political cliques which controlled the affairs of the city. It is likely
that they bore somewhat the same relation to these cliques that the
politico-industrial magnates and financiers of to-day do; to all
appearances distinctly apart from participation in politics, and yet by
means of money, having a strong or commanding influence in the
background. But the Rhinelander brothers, William and Frederick, were
integral members of the political machine in power. Thus we find that in
1803, William Rhinelander was elected Assessor for the Fifth Ward (a
highly important and sumptuary office at that time), while both he and
Frederick were, at the same time, appointed inspectors of
elections.[106]
The action of the city officials in disposing of city land to
themselves, to political accomplices and to favorites (who, it is
probable, although not a matter of proof, paid bribes) took two forms.
One was the granting of land under water, the other the granting of city
real estate. At that time the configuration of Manhattan Island was such
that it was marked by ponds, streams and marshes, while the marginal
lines of the Hudson River and the East River extended much further
inland than now. When an individual got what was called a water grant,
it meant land under shallow water, where he had the right to build
bulkheads and wharves and to fill in and make solid ground. Out of these
water grants was created property now worth hundreds upon hundreds of
millions of dollars. The value at that time was not great, but the
prospective value was immense. This fact was recognized in the official
reports of the day, which set forth how rapidly the city's population
and commerce were increasing. As for city land as such, the city not
only owned large tracts by reason of old grants and confiscations, but
it constantly came into possession of more because of non-payment of
taxes.
The excuses by which the city officials covered their short-sighted or
fraudulent grants of the water rights and the city land were various.
One was that the gifts were for the purpose of assisting religious
institutions. This, however, was but an occasional excuse. The principal
excuse which was persisted in for forty years was that the city needed
revenue. This was a fact. The succeeding city administrations so
corruptly and extravagantly squandered the city's money that the city
was constantly in debt. Perhaps this debt was created for the very
purpose of having a plausible ground for disposing of city land. So it
was freely charged at that time.
THE CITY CREATES LANDLORDS.
Let us see how the religious motive worked. On June 10, 1794, the city
gave to Trinity Church a water grant covering all that land from
Washington street to the North River between Chambers and Reade streets.
The annual rent was one shilling per running foot after the expiration
of forty-two years from June 10, 1794. Thus, for forty-two years, no
rent was charged. Shortly after the passage of this grant, Trinity
Church conveyed it to William Rhinelander, and also all that ground
between Jay and Harrison streets, from Greenwich street to the North
River. By a subsequent arrangement with Trinity Church and the city, all
of this land as well as certain other Trinity land became William
Rhinelander's property; and then, by agreement of the Common Council on
May 29, 1797, and confirmation of Nov. 16, 1807, he was given all rights
to the land water between high and low water mark, bounding his
property, for an absurdly low rental.[107] These water grants were
subsequently filled in and became of enormous value.
Astor was as energetic as Rhinelander in getting grants from the city
officials. In 1806 he obtained two of large extent on the East Side--on
Mangin street between Stanton and Houston streets, and on South street
between Peck Slip and Dover street. On May 30, 1808, upon a favorable
report handed in by the Finance Committee, of which the notorious John
Bingham was a member, Astor received an extensive grant along the Hudson
bounding the old Burr estate which had come into his possession.[108] In
1810 he received three more water grants in the vicinity of Hubert,
Laight, Charlton, Hammersly and Clarkson streets, and on April 28, 1828,
three at Tenth avenue, Twelfth, Thirteenth, Fourteenth and Fifteenth
streets. These were some of the grants that he received. But they do not
include the land in the heart of the city that he was constantly buying
from private owners or getting by the evident fraudulent connivance of
the city officials.
Having obtained the water grants and other land by fraud, what did the
grantees next proceed to do? They had them filled in, not at their own
expense, but largely at the expense of the municipality. Sunken lots
were filled in, sewers placed, and streets opened, regulated and graded
at but the merest minimum of expense to these landlords. By fraudulent
collusion with the city authorities they foisted much of the expense
upon the taxpayers. How much money the city lost by this process in the
early decades of the nineteenth century was never known. But in 1855
Controller Flagg submitted to the Common Council an itemized statement
for the five years from 1850 in which he referred to "the startling fact
that the city's payments, in a range of five years [for filling in
sunken lots, regulating and grading streets, etc.], exceed receipts by
the sum of more than two millions of dollars."[109]
MANY PARTICIPANTS IN THE CURRENT FRAUDS.
In the case of most of these so-called water fronts, there was usually a
trivial rental attached. Nearly always, however, this was commuted upon
payment of a small designated sum, and a full and clear title was then
given by the city. In this rush to get water-grants--grants many of
which are now solid land filled with business and residential
buildings--many of the ancestors of those families which pride
themselves upon their exclusive air participated. The Lorillards, the
Goelets, William F. Havemeyer, Cornelius Vanderbilt, W. H. Webb, W. H.
Kissam, Robert Lenox, Schermerhorn, James Roosevelt, William E. Dodge,
Jr.--all of these and many others--not omitting Astor's American Fur
Company--at various times down to, and including the period of, the
monumentally corrupt Tweed "ring," got grants from corrupt city
administrations. Some of these water rights, that is to say, such
fragmentary parts of them as pertained to wharves and bulkheads, New
York City, in recent years, has had to buy back at exorbitant prices.
From the organization of the Dock Department down to 1906 inclusive, New
York City had expended $70,000,000 for the purchase of bulkhead and
wharf property and for construction.
During all the years from 1800 on, Astor, in conjunction with other
landholders, was manipulating the city government not less than the
State and Federal Government. Now he gets from the Board of Aldermen
title to a portion of this or that old country road on Manhattan which
the city closes up; again and again he gets rights of land under water.
He constantly solicits the Board of Aldermen for this or that right or
privilege and nearly always succeeds. No property or sum is too small
for his grasp. In 1832, when Eighth avenue, from Thirteenth to
Twenty-third streets is graded down and the earth removed is sold by the
city to a contractor for $3,049.44, Astor, Stephen D. Beekman and Jacob
Taylor petition that each get a part of the money for earth removed from
in front of their lots. This is considered such a petty attempt at
defrauding, that the Aldermen call it an "unreasonable petition" and
refuse to accede.[110] In 1834 the Aldermen allow him a part of the old
Hurlgate road, and Rhinelander a part of the Southampton road. Not a
year passes but that he does not get some new right or privilege from
the city government. At his request some streets are graded and
improved; the improvement of such other streets as is not to his
interest to have improved is delayed. Here sewers are placed; then they
are refused. Every function of city administration was incessantly used
by him. The cumulative effect of this class use of government was to
give him and others a constant succession of grants and privileges that
now have a prodigious value.
But it should be noted that those who thus benefited, singularly enjoyed
the advantages of laws and practices. For city land that they bought
they were allowed to pay on easy terms; not infrequently the city had to
bring action for final payment. But the tenants of these landlords had
to pay rent on the day that it fell due, or within a few days of the
time; they could not be in arrears more than three days without having
to face dispossess proceedings. Nor was this all the difference. On
land which they corruptly obtained from the city and which, to a large
extent, they fraudulently caused to be filled in, regulated, graded or
otherwise improved at the expense of the whole community, the landlords
refused to pay taxes promptly, just as they refused to pay them on land
that they had bought privately. What was the result? "Some of our
wealthiest citizens," reported the Controller in 1831, "are in the habit
of postponing the payment of taxes for six months and more, and the
Common Council are necessitated to borrow money on interest to meet the
ordinary disbursements of the city."[111] If a man of very moderate
means were backward in payment of taxes, the city promptly closed him
out, and if a tenant of any of these delinquent landlords were
dispossessed for non-payment of rent, the city it was which undertook
the process of eviction. The rich landlord, however, could do as he
pleased, since all government represented his interests and those of his
class. Instead of the punishment for non-payment of taxes being visited
upon him, it was imposed upon the whole community in the form of
interest-bearing bonds.
PILLAGE, PROFITS AND LAND.
The money that Astor secured by robbing the Indians and exploiting the
workers by means of monopolies, he thus put largely into land. In 1810,
a story runs, he offers to sell a Wall Street lot for $8,000. The price
is so low that a buyer promptly appears. "Yes, you are astonished,"
Astor says. "But see what I intend to do with that eight thousand
dollars. That Wall Street lot, it is true, will be worth twelve thousand
dollars in a few years. But I shall take that eight thousand dollars
and buy eighty lots above Canal street and by the time your one lot is
worth twelve thousand dollars, my eighty lots will be worth eighty
thousand dollars." So goes one of the fine stories told to illustrate
his foresight, and to prove that his fortune came exclusively from that
faculty and from his industry.
This version bears all the impress of being undoubtedly a fraud. Astor
was remarkably secretive and dissembling, and never revealed his plans
to anyone. That he bought the lots is true enough, but his attributed
loquacity is mythical and is the invention of some gushing eulogist. At
that time he was buying for $200 or $300 each many lots on lower
Broadway, then, for the most part, an unoccupied waste. What he was
counting upon was the certain growth of the city and the vastly
increasing values not that he would give his land, but which would
accrue from the labor of an enlarged population. These lots are now
occupied by crowded business buildings and are valued at from $300,000
to $400,000 each.
Throughout those years in the first decade of the nineteenth century he
was constantly buying land on Manhattan Island. Practically all of it
was bought, not with the idea of using it, but of holding it and
allowing future populations to make it a thousand times more valuable.
An exception was his country estate of thirteen acres at Hurlgate
(Hellgate) in the vicinity of Sixtieth street and the East River. It was
curious to look back at the fact that less than a century ago the upper
regions of Manhattan Island were filled with country estates--regions
now densely occupied by huge tenement houses and some private dwellings.
In those days, not less than in these, a country seat was considered a
necessary appendage to the possessions of a rich man. Astor bought that
Hurlgate estate as a country seat; but as such it was long since
discontinued although the land comprising it has never left the hold of
the Astor family.
What were the intrinsic circumstances of the means by which he bought
land, now worth hundreds of millions of dollars? For once, we get a
gleam of the truth, but a gleam only, in the "popular writer's" account
when he says: "John Jacob Astor's record is constantly crossed by
embarrassed families, prodigal sons, mortgages and foreclosure sales.
Many of the victims of his foresight were those highest in church and
state. He thus acquired for $75,000 one-half of Governor George
Clinton's splendid Greenwich country place [in the old Greenwich village
on the west side of Manhattan Island].... After the Governor's death, he
kept persistently at the heirs, lent them money and acquired additional
slices of the family property.... Nearly two-thirds of the Clinton farm
is now held by Astor's descendants, and is covered by scores of business
buildings, from which is derived an annual income estimated at
$500,000."
THE FATE OF OTHERS HIS GAIN.
In this transaction we see the beginnings of that period of conquest on
the part of the very rich using their surplus capital in effacing the
less rich--a period which really opened with Astor and which has been
vastly intensified in recent times. Clinton was accounted a rich man in
his day, but he was a pigmy in that respect compared to Astor. With his
incessant inflow of surplus wealth, Astor was in a position where on the
instant he could take advantage of the difficulties of less rich men and
take over to himself their property. A large amount of Astor's money was
invested in mortgages. In times of periodic financial and industrial
distress, the mortgagers were driven to extremities and could no longer
keep up their payments. These were the times that Astor waited for, and
it was in such times that he stepped in and possessed himself, at
comparatively small expense, of large additional tracts of land.
It was this way that he became the owner of what was then the Cosine
farm, extending on Broadway from Fifty-third to Fifty-seventh streets
and westward to the Hudson River. This property, which he got for
$23,000 by foreclosing a mortgage, is now in the very heart of the city,
filled with many business, and every variety of residential, buildings,
and is rated as worth $6,000,000. By much the same means he acquired
ownership of the Eden farm in the same vicinity, coursing along Broadway
north from Forty-second street and slanting over to the Hudson River.
This farm lay under pledges for debt and attachments for loans. Suddenly
Astor turned up with a third interest in an outstanding mortgage,
foreclosed, and for a total payment of $25,000 obtained a sweep of
property now covered densely with huge hotels, theaters, office
buildings, stores and long vistas of residences and tenements--a
property worth at the very least $25,000,000. Any one with sufficient
security in land who sought to borrow money would find Astor extremely
accommodating. But woe betide the hapless borrower, whoever he was, if
he failed in his obligations to the extent of even a fraction of the
requirements covered by law! Neither personal friendship, religious
considerations nor the slightest feelings of sympathy availed.
But where law was insufficient or non-existent, new laws were created
either to aggrandize the powers of landlordship, or to seize hold of
land or enchance its value, or to get extraordinary special privileges
in the form of banking charters. And here it is necessary to digress
from the narrative of Astor's land transactions and advert to his
banking activities, for it was by reason of these subordinately, as well
as by his greater trade revenues, that he was enabled so successfully to
pursue his career of wealth-gathering. The circumstances as to the
origin of certain powerful banks in which he and other landholders and
traders were large stockholders, the methods and powers of those banks,
and their effect upon the great body of the people, are component parts
of the analytic account of his operations. Not a single one of Astor's
biographers has mentioned his banking connections. Yet it is of the
greatest importance to describe them, inasmuch as they were closely
intertwined with his trade, on the one hand, and with his land
acquisitions, on the other.
FOOTNOTES:
[90] Doc. No. 13, State Papers, Second Session, 18th Congress, Vol. ii.
[91] "Stole on a monstrous scale." The land frauds, by which many of the
Southern planters obtained estates in Louisiana, Mississippi and other
States were a national scandal. Benjamin F. Linton, United States
Attorney for Western Louisiana, reported to President Andrew Jackson on
August 27, 1835, that in seizing possession of Government land in that
region "the most shameful frauds, impositions and perjuries had been
committed in Louisiana." Sent to investigate, V. M. Garesche, an agent
of the Government Land Office, complained that he could get no one to
testify. "Is it surprising," he wrote to the Secretary of the Treasury,
"when you consider that those engaged in this business belong to every
class of society from the member of the Legislature (if I am informed
correctly) down to the quarter quarter-section settler!" Up to that time
the Government held title to immense tracts of land in the South and had
thrown it open to settlers. Few of these were able to get it, however.
Southern plantation men and Northern capitalists and speculators
obtained possession by fraud. "A large company," Garesche reported, "was
formed in New York for the purpose, and have an agent who is continually
scouring the country." The final report was a whitewashing one; hence,
none of the frauds was sent to jail.--Doc. No. 168, Twenty-fourth
Congress, 2d Session, ii:4-25, also Doc. No. 213, Ibid.
[92] "America," admits Houghton, "never presented a more shameful
spectacle than was exhibited when the courts of the cotton-growing
regions united with the piratical infringers of Whitney's rights in
robbing their greatest benefactor.... In spite of the far-reaching
benefits of his invention, he had not realized one dollar above his
expenses. He had given millions upon millions of dollars to the
cotton-growing states, he had opened the way for the establishment of
the vast cotton-spinning interests of his own country and Europe, and
yet, after fourteen years of hard labor, he was a poor man, the victim
of wealthy, powerful, and, in his case, a dishonest class."--"Kings of
Fortune":337. All other of Whitney's biographers relate likewise.
[93] See Senate Documents, First Session, 24th Congress, 1835, Vol. vi,
Doc. No. 425. A few extracts from the great mass of correspondence will
lucidly show the nature of the fraudulent methods. Writing from
Columbus, Georgia, on July 15, 1833, Col. John Milton informed the War
Department ... "Many of them [the Indians] are almost starved, and
suffer immensely for the things necessary to the support of life, and
are sinking in moral degradation. They have been much corrupted by white
men who live among them, who induce them to sell to as many different
individuals as they can, and then cheat them out of the proceeds."...
(p. 81.) Luther Blake wrote to the War Department from Fort Mitchell,
Alabama, on September 11, 1833 ... "Many, from motives of speculation,
have bought Indian reserves fraudulently in this way--take their bonds
for trifles, pay them ten or twenty dollars in something they do not
want, and take their receipts for five times the amount." (p. 86). On
February 1, 1834, J. H. Howard, of Pole-Cat Springs, Creek Nation, sent
a communication, by request, to President Jackson in which he said, ...
"From my own observation, I am induced to believe that a number of
reservations have been paid for at some nominal price, and the principal
consideration has been whisky and homespun" ... (p. 104). Gen. J. W. A.
Sandford, sent by President Jackson to the Creek country to investigate
the charges of fraud, wrote, on March 1, 1834, to the War Department,
... "It is but very recently that the Indian has been invested with an
individual interest in land, and the great majority of them appear
neither to appreciate its possession, nor to economize the money for
which it is sold; the consequence is, that the white man rarely suffers
an opportunity to pass by without swindling him out of both".... (p.
110).
The records show that the principal beneficiaries of these swindles were
some of the most conspicuous planters, mercantile firms and politicians
in the South. Frequently, they employed dummies in their operations.
[94] Reports of House Committees, Second Session, 26th Congress,
1840-41, Report No. 1.
[95] Ibid., 1 and 2.
[96] Executive Documents, First Session, 23rd Congress, 1833-34, Doc.
No. 132.
[97] Senate Documents, First Session, 22nd Congress, 1831-33, Vol. iii,
Doc. No. 139.
[98] "No inventor," reported the United States Commissioner of Patents
in 1858, "probably has ever been so harassed, so trampled upon, so
plundered by that sordid and licentious class of infringers known in the
parlance of the world, with no exaggeration of phrase as 'pirates.' The
spoliation of their incessant guerilla upon his defenseless rights have
unquestionably amounted to millions."
[99] Doc. No. 134, Twenty-fourth Congress, 2d Session, Vol. ii.
[100] Doc. 129, State Papers, 1819-21, Vol. ii.
[101] See Part I, Chapter II.
[102] "Allowed itself." The various New York legislatures from the end
of the eighteenth century on were hotbeds of corruption. Time after time
members were bribed to pass bills granting charters for corporations or
other special privileges. (See the numerous specific instances cited in
the author's "History of Tammany Hall," and subsequently in this work.)
The Legislature of 1827 was notoriously corrupt.
[103] Journal of the [New York] Senate, 1815:216--Journal of the [New
York] Assembly, 1818:261; Journal of the Assembly, 1819. Also "A
Statement and Exposition of The Title of John Jacob Astor to the Lands
Purchased by him from the surviving children of Roger Morris and Mary,
his Wife"; New York, 1827.
[104] MSS. Minutes of the (New York City) Common Council, xvi:239-40 and
405.
[105] Ibid., xx: 355-356.
[106] MSS. Minutes of the Common Council, xiii: 118 and 185.
[107] MSS. Minutes of the Common Council, xvii: 141-144. See also Annual
Report of Controller for 1849, Appendix A.
[108] MSS. Minutes of the Common Council, xviii: 411-414.
[109] Doc. No. 33, Documents of the Board of Aldermen, xxii:26.
[110] Proceedings of the Board of Aldermen, 1832-33, iv: 416-418.
[111] Controller's Reports for 1831:7. Also Ibid. for 1841:28.