Gotham_ A History of New York City to 1898 - Edwin G. Burrows [727]
Winning Chamber of Commerce support gave the triumvirate high hopes for success, but, taking no chances, Gould traveled to Albany, reportedly with a trunk full of thousand-dollar bills, set up shop in the Delavan House, and began buying votes. The Commodore swiftly dispatched counterbribery agents, among them William Tweed, who installed themselves on another floor of the same hostelry. Legislators shuttled back and forth in search of the highest bidder. With the Erie’s treasury close at hand, Gould’s was the more bottomless wallet, and Vanderbilt’s troops deserted him, even Tweed—who was rewarded for his treachery with lavish supplies of Erie stock, netting him $650,000 in all. The desired legislation passed.
Vanderbilt didn’t give up. He met secretly with Drew, who—miserable in New Jersey and ready as ever to sell out his partners—whined his way back into the Commodore’s good graces and initiated a deal. In return for Vanderbilt’s withdrawing his lawsuits and allowing the exiles to come home, Erie would buy back a hefty chunk of his recently purchased stock, even though it would add millions to the company’s debt and leave it virtually bankrupt.
Drew left the road to Gould and Fisk—and two new board appointees, Tweed and his henchman Sweeney—and the duo settled into control of Erie. At Fisk’s urging, they purchased for their headquarters the floundering Pike’s Opera House (at Eighth Avenue and 23rd Street). The top floors became offices; the bottom part—now festooned with frescoes and gilded balustrades—became the Grand Opera House, a theater in which Fisk, wearing his impresario hat, staged extravaganzas. The flamboyance disturbed Gould, who preferred anonymity, but Fisk was in his element. He installed his mistress Josie in a nearby house, and she presided over regular champagne and poker soirees for Boss Tweed, Judge Barnard, and others in what people now called the “Erie Ring.”
Gould proceeded to wring a fortune from the supposedly squeezed-dry railroad by spreading false rumors that sent Erie’s stock quote dancing in the direction he desired. In the course of one audacious scam Gould fleeced his quondam partner Drew so thoroughly that he was forever washed up as a major Wall Street figure. Gould’s gambits, however, deeply disturbed the Erie’s English bondholders, and they asked August Belmont to organize his ouster from the presidency. Gould, in a brilliant maneuver, had the ever complaisant Judge Barnard throw the road into receivership and appoint him its caretaker.
At this point the Erie buccaneers came up against a worthier opponent. Determined to take over a small but strategically located upstate New York railroad, Gould and Fisk began buying its stock on the market. The desperate directors turned for help to Pierpont Morgan. The ensuing contest was a bruiser, the highlight of which was a shootout for control of a railway station in Binghamton. Fisk recruited a small army of eight hundred gang members from the Five Points; Morgan countered with recruits from the Bowery; and in the ensuing free-for-all, at least eight men were shot before the state militia intervened. Morgan’s forces triumphed, and Fisk returned to New York, famously remarking that “nothing is lost save honor.”
Morgan solidified his clients’ position by arranging for a friendly merger with a larger company, then sought and obtained a seat on the board of directors of the consolidated company. It was Morgan’s first such position, and it marked the beginning of a portentous new relationship between financiers and industrialists.
Gould’s railroad predations had seriously annoyed conservative bankers like Morgan, but his next venture, an audacious foray into high