Chicago Gas
Old Peter Laughlin, rejuvenated by Cowperwood's electric ideas, was
making money for the house. He brought many bits of interesting gossip
from the floor, and such shrewd guesses as to what certain groups and
individuals were up to, that Cowperwood was able to make some very
brilliant deductions.
"By Gosh! Frank, I think I know exactly what them fellers are trying to
do," Laughlin would frequently remark of a morning, after he had lain
in his lonely Harrison Street bed meditating the major portion of the
night. "That there Stock Yards gang" (and by gang he meant most of the
great manipulators, like Arneel, Hand, Schryhart and others) "are after
corn again. We want to git long o' that now, or I miss my guess. What
do you think, huh?"
Cowperwood, schooled by now in many Western subtleties which he had not
previously known, and daily becoming wiser, would as a rule give an
instantaneous decision.
"You're right. Risk a hundred thousand bushels. I think New York
Central is going to drop a point or two in a few days. We'd better go
short a point."
Laughlin could never figure out quite how it was that Cowperwood always
seemed to know and was ready to act quite as quickly in local matters
as he was himself. He understood his wisdom concerning Eastern shares
and things dealt in on the Eastern exchange, but these Chicago matters?
"Whut makes you think that?" he asked Cowperwood, one day, quite
curiously.
"Why, Peter," Cowperwood replied, quite simply, "Anton Videra" (one of
the directors of the Wheat and Corn Bank) "was in here yesterday while
you were on 'change, and he was telling me." He described a situation
which Videra had outlined.
Laughlin knew Videra as a strong, wealthy Pole who had come up in the
last few years. It was strange how Cowperwood naturally got in with
these wealthy men and won their confidence so quickly. Videra would
never have become so confidential with him.
"Huh!" he exclaimed. "Well, if he says it it's more'n likely so."
So Laughlin bought, and Peter Laughlin & Co. won.
But this grain and commission business, while it was yielding a profit
which would average about twenty thousand a year to each partner, was
nothing more to Cowperwood than a source of information.
He wanted to "get in" on something that was sure to bring very great
returns within a reasonable time and that would not leave him in any
such desperate situation as he was at the time of the Chicago
fire--spread out very thin, as he put it. He had interested in his
ventures a small group of Chicago men who were watching him--Judah
Addison, Alexander Rambaud, Millard Bailey, Anton Videra--men who,
although not supreme figures by any means, had free capital. He knew
that he could go to them with any truly sound proposition. The one
thing that most attracted his attention was the Chicago gas situation,
because there was a chance to step in almost unheralded in an as yet
unoccupied territory; with franchises once secured--the reader can
quite imagine how--he could present himself, like a Hamilcar Barca in
the heart of Spain or a Hannibal at the gates of Rome, with a demand
for surrender and a division of spoils.
There were at this time three gas companies operating in the three
different divisions of the city--the three sections, or "sides," as
they were called--South, West, and North, and of these the Chicago Gas,
Light, and Coke Company, organized in 1848 to do business on the South
Side, was the most flourishing and important. The People's Gas, Light,
and Coke Company, doing business on the West Side, was a few years
younger than the South Chicago company, and had been allowed to spring
into existence through the foolish self-confidence of the organizer and
directors of the South Side company, who had fancied that neither the
West Side nor the North Side was going to develop very rapidly for a
number of years to come, and had counted on the city council's allowing
them to extend their mains at any time to these other portions of the
city. A third company, the North Chicago Gas Illuminating Company, had
been organized almost simultaneously with the West Side company by the
same process through which the other companies had been brought into
life--their avowed intention, like that of the West Side company, being
to confine their activities to the sections from which the organizers
presumably came.
Cowperwood's first project was to buy out and combine the three old
city companies. With this in view he looked up the holders in all
three corporations--their financial and social status. It was his idea
that by offering them three for one, or even four for one, for every
dollar represented by the market value of their stock he might buy in
and capitalize the three companies as one. Then, by issuing sufficient
stock to cover all his obligations, he would reap a rich harvest and at
the same time leave himself in charge. He approached Judah Addison
first as the most available man to help float a scheme of this kind.
He did not want him as a partner so much as he wanted him as an
investor.
"Well, I'll tell you how I feel about this," said Addison, finally.
"You've hit on a great idea here. It's a wonder it hasn't occurred to
some one else before. And you'll want to keep rather quiet about it,
or some one else will rush in and do it. We have a lot of venturesome
men out here. But I like you, and I'm with you. Now it wouldn't be
advisable for me to go in on this personally--not openly, anyhow--but
I'll promise to see that you get some of the money you want. I like
your idea of a central holding company, or pool, with you in charge as
trustee, and I'm perfectly willing that you should manage it, for I
think you can do it. Anyhow, that leaves me out, apparently, except as
an Investor. But you will have to get two or three others to help carry
this guarantee with me. Have you any one in mind?"
"Oh yes," replied Cowperwood. "Certainly. I merely came to you
first." He mentioned Rambaud, Videra, Bailey, and others.
"They're all right," said Addison, "if you can get them. But I'm not
sure, even then, that you can induce these other fellows to sell out.
They're not investors in the ordinary sense. They're people who look
on this gas business as their private business. They started it. They
like it. They built the gas-tanks and laid the mains. It won't be
easy."
Cowperwood found, as Addison predicted, that it was not such an easy
matter to induce the various stock-holders and directors in the old
companies to come in on any such scheme of reorganization. A closer,
more unresponsive set of men he was satisfied he had never met. His
offer to buy outright at three or four for one they refused absolutely.
The stock in each case was selling from one hundred and seventy to two
hundred and ten, and intrinsically was worth more every year, as the
city was growing larger and its need of gas greater. At the same time
they were suspicious--one and all--of any combination scheme by an
outsider. Who was he? Whom did he represent? He could make it clear
that he had ample capital, but not who his backers were. The old
officers and directors fancied that it was a scheme on the part of some
of the officers and directors of one of the other companies to get
control and oust them. Why should they sell? Why be tempted by greater
profits from their stock when they were doing very well as it was?
Because of his newness to Chicago and his lack of connection as yet
with large affairs Cowperwood was eventually compelled to turn to
another scheme--that of organizing new companies in the suburbs as an
entering-wedge of attack upon the city proper. Suburbs such as Lake
View and Hyde Park, having town or village councils of their own, were
permitted to grant franchises to water, gas, and street-railway
companies duly incorporated under the laws of the state. Cowperwood
calculated that if he could form separate and seemingly distinct
companies for each of the villages and towns, and one general company
for the city later, he would be in a position to dictate terms to the
older organizations. It was simply a question of obtaining his
charters and franchises before his rivals had awakened to the situation.
The one difficulty was that he knew absolutely nothing of the business
of gas--its practical manufacture and distribution--and had never been
particularly interested init. Street-railroading, his favorite form of
municipal profit-seeking, and one upon which he had acquired an almost
endless fund of specialized information, offered no present practical
opportunity for him here in Chicago. He meditated on the situation, did
some reading on the manufacture of gas, and then suddenly, as was his
luck, found an implement ready to his hand.
It appeared that in the course of the life and growth of the South Side
company there had once been a smaller organization founded by a man by
the name of Sippens--Henry De Soto Sippens--who had entered and
actually secured, by some hocus-pocus, a franchise to manufacture and
sell gas in the down-town districts, but who had been annoyed by all
sorts of legal processes until he had finally been driven out or
persuaded to get out. He was now in the real-estate business in Lake
View. Old Peter Laughlin knew him.
"He's a smart little cuss," Laughlin told Cowperwood. "I thort onct
he'd make a go of it, but they ketched him where his hair was short,
and he had to let go. There was an explosion in his tank over here
near the river onct, an I think he thort them fellers blew him up.
Anyhow, he got out. I ain't seen ner heard sight of him fer years."
Cowperwood sent old Peter to look up Mr. Sippens and find out what he
was really doing, and whether he would be interested to get back in the
gas business. Enter, then, a few days later into the office of Peter
Laughlin & Co. Henry De Soto Sippens. He was a very little man, about
fifty years of age; he wore a high, four-cornered, stiff felt hat, with
a short brown business coat (which in summer became seersucker) and
square-toed shoes; he looked for all the world like a country drug or
book store owner, with perhaps the air of a country doctor or lawyer
superadded. His cuffs protruded too far from his coat-sleeves, his
necktie bulged too far out of his vest, and his high hat was set a
little too far back on his forehead; otherwise he was acceptable,
pleasant, and interesting. He had short side-burns--reddish
brown--which stuck out quite defiantly, and his eyebrows were heavy.
"Mr. Sippens," said Cowperwood, blandly, "you were once in the gas
manufacturing and distributing business here in Chicago, weren't you?"
"I think I know as much about the manufacture of gas as any one,"
replied Sippens, almost contentiously. "I worked at it for a number of
years."
"Well, now, Mr. Sippens, I was thinking that it might be interesting to
start a little gas company in one of these outlying villages that are
growing so fast and see if we couldn't make some money out of it. I'm
not a practical gas man myself, but I thought I might interest some one
who was." He looked at Sippens in a friendly, estimating way. "I have
heard of you as some one who has had considerable experience in this
field here in Chicago. If I should get up a company of this kind, with
considerable backing, do you think you might be willing to take the
management of it?"
"Oh, I know all about this gas field," Mr. Sippens was about to say.
"It can't be done." But he changed his mind before opening his lips.
"If I were paid enough," he said, cautiously. "I suppose you know what
you have to contend with?"
"Oh yes," Cowperwood replied, smiling. "What would you consider 'paid
enough' to mean?"
"Oh, if I were given six thousand a year and a sufficient interest in
the company--say, a half, or something like that--I might consider it,"
replied Sippens, determined, as he thought, to frighten Cowperwood off
by his exorbitant demands. He was making almost six thousand dollars a
year out of his present business.
"You wouldn't think that four thousand in several companies--say up to
fifteen thousand dollars--and an interest of about a tenth in each
would be better?"
Mr. Sippens meditated carefully on this. Plainly, the man before him
was no trifling beginner. He looked at Cowperwood shrewdly and saw at
once, without any additional explanation of any kind, that the latter
was preparing a big fight of some sort. Ten years before Sippens had
sensed the immense possibilities of the gas business. He had tried to
"get in on it," but had been sued, waylaid, enjoined, financially
blockaded, and finally blown up. He had always resented the treatment
he had received, and he had bitterly regretted his inability to
retaliate. He had thought his days of financial effort were over, but
here was a man who was subtly suggesting a stirring fight, and who was
calling him, like a hunter with horn, to the chase.
"Well, Mr. Cowperwood," he replied, with less defiance and more
camaraderie, "if you could show me that you have a legitimate
proposition in hand I am a practical gas man. I know all about mains,
franchise contracts, and gas-machinery. I organized and installed the
plant at Dayton, Ohio, and Rochester, New York. I would have been rich
if I had got here a little earlier." The echo of regret was in his
voice.
"Well, now, here's your chance, Mr. Sippens," urged Cowperwood, subtly.
"Between you and me there's going to be a big new gas company in the
field. We'll make these old fellows step up and see us quickly.
Doesn't that interest you? There'll be plenty of money. It isn't that
that's wanting--it's an organizer, a fighter, a practical gas man to
build the plant, lay the mains, and so on." Cowperwood rose suddenly,
straight and determined--a trick with him when he wanted to really
impress any one. He seemed to radiate force, conquest, victory. "Do
you want to come in?"
"Yes, I do, Mr. Cowperwood!" exclaimed Sippens, jumping to his feet,
putting on his hat and shoving it far back on his head. He looked like
a chest-swollen bantam rooster.
Cowperwood took his extended hand.
"Get your real-estate affairs in order. I'll want you to get me a
franchise in Lake View shortly and build me a plant. I'll give you all
the help you need. I'll arrange everything to your satisfaction within
a week or so. We will want a good lawyer or two."
Sippens smiled ecstatically as he left the office. Oh, the wonder of
this, and after ten years! Now he would show those crooks. Now he had
a real fighter behind him--a man like himself. Now, by George, the fur
would begin to fly! Who was this man, anyhow? What a wonder! He would
look him up. He knew that from now on he would do almost anything
Cowperwood wanted him to do.