The Life and Legend of E. H. Harriman by Maury Klein

From the Publisher

This biography of E. H. Harriman (1847-1909) reasserts his legacy as one of America's greatest financiers and railroad leaders. A Wall Street banker until age 50, Harriman catapulted into the railroad arena in 1897 by gaining control of the Union Pacific Railroad as it emerged from bankruptcy. He later acquired large stakes in the Southern Pacific and the Baltimore and Ohio, sometimes clashing with James J. Hill, J. P. Morgan, and Theodore Roosevelt.

Wall Street Journal

A very fine biography. . . . These tales are well-told by Mr. Klein, who brings them together skillfully to create a picture of the whole man. But the author does not presume that the reader has unlimited time. At a little under 450 pages of text, the book is none too long for so richly filled a life. Further, it is handsomely and readably designed. . . . A vastly informative and entertaining biography of a major figure in American history who made a great fortune without losing a sense of the vitality of life outside business.

Publishers Weekly

"My time," Edward Henry Harriman once said, "is worth a mule a minute." It was a rare understatement. Known as "the Colossus of [Rail]Roads," having transformed himself at age 50 from Wall Street banker to audacious transcontinental octopus, Harriman (1847-1909) spent his late years developing, acquiring, merging and modernizing railroads from the Union Pacific to the Burlington. With businesslike authority, Klein (a historian at the University of Rhode Island and author of The Life and Legend of Jay Gould) vividly tells the story of a man who rose from being a minister's son with few prospects to an efficient, visionary entrepreneur. Klein makes a strong argument that, although not as well remembered as his peers, Harriman was in a league with financial titans Rockefeller and Carnegie; indeed, the author suggests, Harriman accomplished as much in a decade as they did in their entire careers. The book suffers from an overabundance of cliches, however, and lacks the clarity of a central organizing theme. Klein bogs down in the minutiae of banking and railroading, and yet it is difficult for readers to evaluate the size of Harriman's fortune since Klein never translates the dollar values into today's terms. Still, by the close of this sprawling epic tale--on the afternoon of Harriman's burial when every train in the magnate's dominion was momentarily stilled, bringing the nation to a near halt--Klein succeeds in persuading us that Harriman created an infrastructure with an important legacy. B&w photos. (Mar.) Copyright 2000 Cahners Business Information.|

American History - Joseph Sweet

The Life & Legend of E.H. Harriman is a well-written, highly readable, noteworthy contribution both as a biography of the individual and an analysis of the restructuring of railroads. It is a commendable effort to understand a man who drove himself to the heights of his chosen profession and put him within the complicated business history of his times.

Obviously well researched, this book gives us an intimate understanding of a complex man and should remain a standard biography for generations.

Wall Street Journal

A vastly informative and entertaining biography of a major figure in American history who made a great fortune without losing a sense of the vitality of life outside business.

What People Are Saying

Jean Strouse
No one else has written so well or so comprehensively about this major American figure.
— Jean Strouse, author of Morgan: American Financier

Product Details

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• Read an Excerpt
• Read a Sample Chapter

Table of Contents

Read an Excerpt

[Harriman] was a dominant factor in the inner circles of the greatest banking institutions. The vast resources of the New York life insurance companies were at his disposition. Ramifications of his political power, Federal and State, extended to every quarter of the land. State and even national conventions took his orders. Members of Congress did his bidding. Laws were enacted at his will. Only two men ever dared to block his path. The late J. P. Morgan stood between him and the possession of the Northern Pacific Railroad in 1901; and Theodore Roosevelt thwarted his purpose to become an absolute dictator of the transportation affairs of the United States.--William Z. Ripley, "Federal Financial Railway Regulation"

On a wall in Harriman's office hung a picture taken during an inspection trip through Mexico. The party had paused to examine a small railroad servicing a copper mine, and the photographer captured a dozen men, including Stillman, William Rockefeller, and Epes Randolph. By far the most inconspicuous figure in the group was Harriman, who was ignoring the camera in favor of a Mexican policeman with whom he was shaking hands. The policeman towering above the slight man in the baggy clothes and battered felt hat looked far more important and impressive.[1]

Anonymity had served Harriman well for many years, but now it was gone just when he needed it most. He had become a public target at a time when he needed to husband his fading strength for the work at hand but instead had to spend it fending off attacks. The economy had turned sluggish and many financiers thought hard times lay ahead. Harriman's properties required close attention to remain at the high standard of performance he had established. He was approaching the age when many leaders think of retirement or begin grooming a successor. Harriman did neither. Time had not slaked his ambition nor attacks dented his determination. He knew only one way to fight, and that was to stand his ground until the right prevailed. "I would give up the whole business," he told Alex Millar, "if I could be sure my plans would be carried out."[2]

But Harriman knew there was no one able to carry out his plans. Far from looking to get out, he was looking to get deeper in. The problem was that his way of doing things consumed enormous amounts of energy. He relied on an assertive personality that took command in everything; on a bulldog tenacity that argued for a policy until he wore others down; on knowing more than anyone else by doing his homework; and on sound judgment that required clear, fresh thinking. The Harriman style taxed both mental and physical stamina, and it permitted no shortcuts. To maintain this high level of dedication while engaged in prolonged controversies and blocking out constant pain asked much of his ebbing vitality.

The drain on his strength forced him to economize in every way, made him more imperious and impatient, more curt even to his friends and more peevish when thwarted. A man already renowned for his lack of charm grew even more brutal as he pared every action down to its essence. Eventually, of course, death would block his plans, but death was a subject he scrupulously avoided. It was not to be thought of or discussed. In fact, Harriman had lived with the fear of death all his life, only he knew it by another name: failure.

During 1906 two incidents occurred amid the Equitable and Illinois Central fights that twisted what should have been personal triumphs into examples of how the prevailing climate of public opinion warped everything Harriman touched. Both arose as protests to Harriman's dividend policy, which one critic labeled "conservatism run mad." The first involved the Wells Fargo company. Few people knew that Harriman had anything to do with this fabled banking and express firm until headlines blared the news in the summer of 1906. He had gained control of it shortly after buying into the Southern Pacific. The big four express companies--Adams, American, United States, and Wells Fargo--depended on railroad contracts for their business. Harriman wanted Wells Fargo to handle the express business on all his western roads. The fact that it owned a bank especially appealed to him.[3]

After taking charge of Wells Fargo, Harriman separated the bank from the express business and in April 1905 merged it with a Nevada bank run by an associate. The bank stopped issuing annual reports and gave out no information on its assets, earnings, and activities. It was an open secret that Harriman tapped Wells Fargo's surplus for loans to finance his rail operations. Rumors about these low-interest loans exposed him to the same charges that arose in the Equitable scandal then unfolding. No one accused him of damaging Wells Fargo; on the contrary, trouble arose when some stockholders complained that he was paying only an 8 percent dividend while the company netted more than 30 percent on its stock.[4]

In May 1906 some minority holders launched a drive for higher dividends and access to financial information. Harriman grudgingly hiked the dividend to 10 percent and released some figures, but neither move appeased the dissidents. A proxy battle with a novel twist erupted. The minority holders had no desire to change the management; they wished only to compel it to pay larger dividends. As the fight heated up, however, it developed what one observer delicately called "glimpses of feeling entirely outside of the matter at issue." A minority circular bluntly defined the struggle as one "between Mr. Harriman on the one hand and the entire body of 1,900 stockholders on the other."[5]

Here was a fight Harriman neither wanted nor needed, yet he could not avoid it or keep it from overlapping the other controversies splashing his name across headlines. One group of Wells Fargo holders filed suit against him and engaged the flamboyant Samuel Untermyer, who had defended Hyde in the Equitable fight. Harriman countered with William Nelson Cromwell, a high-powered attorney capable of dueling Untermyer in any battle of mouths. When the stockholders convened early in August, Harriman won a decisive but costly victory. During the meeting, Cromwell delivered an impassioned defense of the management in which he said of Harriman, "It is not on the business acumen of the officers but on his wonderful executive genius on which the stockholders must rely if the prosperity of the company is to continue. He cannot be replaced, for he moves in a higher world into which we may not enter."[6]

Critics across America pounced gleefully on Cromwell's "higher world" phrase as the perfect emblem of Harriman's aloofness, arrogance, and high-handed methods. Wells Fargo flourished while the other express companies struggled, but public attention ignored performance in favor of an image that fit the current perception of Harriman. A second incident at almost exactly the same time reinforced the impression, this one involving a dividend on the Union Pacific. For years analysts had heaped praise on Harriman's handling of the Union Pacific. While most of this attention went to its operation and reconstruction, thoughtful observers recognized that its financial record was no less brilliant.[7]

Early in 1906, as the road rolled up new records in traffic hauled and the surplus mushroomed, Harriman let the dividend go from 5 percent to 6 percent and fended off the clamor for more with his usual lecture on the need for conservatism. During the spring and summer, however, record earnings continued to pile up on both Pacific systems. The Union Pacific produced a surplus exceeding $25 million; it also owned $90 million worth of Southern Pacific stock on which Harriman had finally decided to pay a 5 percent dividend. This would put another $4.5 million into the Union Pacific treasury, and the securities acquired in the breakup of Northern Securities also poured dividends into the Union Pacific's coffers.[8]

At a board meeting on August 15 the directors absorbed these figures and agreed with Harriman to raise the dividend to 10 percent. Although the Union Pacific had never paid so large a dividend, the size provoked less of an uproar than the circumstances.[9]

Normally the board released news of a dividend at once, but several key directors missed the meeting and Harriman wished to inform them before it went public. The board left the timing of the release to the executive committee, which was to meet the next morning. That session was postponed until three in the afternoon so that Harriman could attend the funeral of an old friend. By then the absent directors had been contacted, but the New York Stock Exchange had closed. If the news went out at once, the London market would get the benefit of it before New York. "We decided that it was best to have the announcement made in New York before it was in London," Harriman explained, "that is, while the New York market was open." The "We" consisted of Harriman, Stillman, and Judge Lovett, the only members present that day.[10]

Normally news of a dividend was hardly the stuff of headlines, but in this case rumors of a major increase in the payment had excited Wall Street for weeks. When the announcement was delayed, two dozen reporters flocked to the Union Pacific office in the Equitable Building on the morning of the sixteenth only to learn that Harriman was absent and the meeting would be held later. When at last the news went out the next morning, an already boiling market sent Union Pacific and Southern Pacific soaring. Those who had lost heart over the delays and sold out or sold short howled in protest.[11]

Angry voices crying fraud soon drowned out the message of the remarkable dividends. "Harriman dividends amaze wall street," blared a Times headline, while beneath it in smaller caps ran the accusation that "the insiders made millions." Harriman was charged with delaying the announcement so that he and his friends could buy Union Pacific stock heavily and profit from the rise they knew the dividend would bring. The Times estimated that Harriman alone pocketed $10 million from this maneuver, which even a moderate journal deplored as a "wrongful use of corporate power." Criticism rained down on Harriman from every quarter even though no one had produced a shred of evidence that any director had bought stock.[12]

The fact that the dividends for both roads represented a sharp reversal of Harriman's past policy lent a veneer of plausibility to the charges. This was exactly the sort of insensitivity to public opinion that made Harriman's friends shudder. Schiff, Kahn, and Stillman tried repeatedly to warn Harriman that he lived in a world where the presence of smoke always heralded fire. "A man at the head of a great corporation," stressed Otto Kahn, "must not only do right, but he must be very careful to avoid even appearances tending to arouse the suspicion of his not doing right." But none of them could curb Harriman's tendency to ride "roughshod over conventionalities and amenities."[13]

Together these episodes imprinted on the public an image of Harriman as a sinister force worthy of the legendary Jay Gould. This negative image completely reversed his actual role and could not have been more distorted, yet it gained credence. Instead of rewarding him for his vision, the march of events elevated him into an unwitting symbol for a host of ills, real and imagined, in the body politic.

Read a Sample Chapter

Chapter One

    Sources of Pride and Strength

The circumstances and conditions that have a determining influence upon a man's life and character often antedate, by many years, his own conscious existence.... When he first becomes conscious of himself and his environment, he is already caught in a web of external relations, conditions and circumstances from which he seldom afterward escapes.

—George Kennan, Autobiography

    For a time early in the nineteenth century the Harriman family seemed destined to an inglorious end in a watery grave. Three of William Harriman's sons met with death at sea in very different ways. The eldest, William, died in a naval clash between English and French ships. Alphonso drowned in the waters off the Battery after the family moved to New York, and Edward simply vanished. His father had made him master of cargo on one of the vessels he fitted out for the West Indies, but the ship never reached port and was never heard from again. Three other sons had died in childhood, leaving only one to carry on the family name. Orlando did not need his mother's fervent pleas to spurn adventure at sea in favor of joining his father in business. Upon that frail reed rose the Harriman dynasty.

    From the first it was shrouded in mystery. No one knows what induced William to leave his comfortable life as a stationer in London. He was said to be in sympathy with the colonial cause, yet he did not sail for America until April 1795, long after the issues of war and peacehad been decided. He was not a poor man; some of his neighbors in New Haven, where he first resided, liked to refer to him as "the rich Englishman." Nor was it a move to be lightly considered. William brought with him the baggage of a full life: a wife, six children, and his wife's sister, Rosamond Holmes. Whatever pushed or pulled him across the sea had to be of more than ordinary force.

    Once settled in New Haven, William tried his luck at the West Indies trade until the treacherous currents of commerce swallowed most of the money he had brought from England. After a few years he took his family to New York City, where he gradually shifted from shipping to a general commission business. There William prospered in a modest way, and young Orlando did well enough to open his own office on Pearl Street in 1811. By the time of William's death around 1820, Orlando had built well on the foundation provided by his father.

    Like his father, Orlando possessed a cold, practical nature that suited a merchant, but he did not neglect the social graces entirely. He met his wife at a dancing school they had both attended since childhood. Anna Ingland was the pampered only daughter of a good family, accomplished in needlework and music as well as dance, and surprisingly practical despite having been indulged all her life. Orlando married her in 1810 when he was only nineteen and just starting out in business. Some thought him rash, but the Harrimans showed a knack for marrying wisely and well that endured for generations.

    Their marriage produced twelve children, eleven of whom survived to adulthood. The matter of names counted for much to families of ambition, who always had an eye cocked toward posterity. This posed a delicate problem for Orlando. He had been named by his aunt Rosamond after a favorite character in Shakespeare's As You Like It. The fit could not have been less appropriate; there was nothing of the romantic in Orlando, who came to loathe his name. With great reluctance he passed it along to his eldest son but thereafter used his influence to fill later generations with Williams and Edwards and other conventional names befitting good businessmen.

    Destiny seemed intent on mocking his intentions. The only child he lost in infancy was named William. Orlando then passed the name to his next son, who died unmarried at the age of thirty. His remaining sons were given the prosaic names of Edward, James, Charles, and Frederick. Only the youngest, Oliver, received a name that smacked of the unusual, and he amassed a larger fortune in business than any of the others. It would have amazed Orlando to know that the Harrimans who left the greatest mark on history descended from his namesake son, the least successful of them all, and that neither Edward nor his sons, William and Edward, ever used those names.

    His growing family kept obliging Orlando to find larger quarters. After a siege of yellow fever quarantined the family, Orlando moved them to a stately old house on Broome Street. Sheltered by rows of maple and elm trees, the house sat in the middle of a large, sloping lawn that became the gathering place for the children and their friends. At the nearby Dutch Reformed Church the Harrimans entered a new social circle that included Herveys, Van Alens, Livingstons, and Lows, who remained their friends for generations.

    The children grew up in this comfortable, idyllic setting until a devastating fire ravaged New York's business district in 1837 and dealt Orlando a blow from which he was slow to recover. As the boys came of age, they joined their father in business except for young Orlando, who showed a flair for scholarship. He was sent off to Columbia, where he did well enough to graduate with honors. Lacking any talent for business, Orlando chose the ministry. In the spring of 1841 he was ordained a deacon in the Episcopal Church, the first Harriman to eschew commerce for the professions.

    It proved an unhappy precedent. Young Orlando was as ill suited for the ministry as he was for business. Like so many of the Harrimans, he possessed a cold, austere personality that seldom warmed or moved his parishioners. The name "Orlando" mocked him as it had his father; he had not a shred of that character's charm or spirit, for which intellectual diligence was a poor substitute. At nineteen he had penned an essay on happiness in which, like St. Paul, he ruled out wealth and glory in favor of goodness and contentment, "the practice of every virtue and the abstaining from every vice." These words served as a perfect epitaph for a life that practiced virtue dutifully without ever veering close to wealth or glory.

    The one gift Orlando did reveal was the family knack for marrying well. Cornelia Neilson was the daughter of a well-known physician and elder of the Dutch Reformed Church. One of her ancestors had served on George Washington's staff, and the family tree was intertwined with Stuyvesants, Fishes, Bleeckers, and Livingstons. Cornelia was a strong, proud woman with a fierce sense of family. Why she accepted Orlando is a mystery unless at twenty-six she had no other offers and prospects looked bleak.

    Their life together got off to a rocky start. The marriage was planned for the spring of 1840, but Orlando's health forced a postponement. By the time it finally took place two years later, Orlando had been ordained and was seeking a position. All his life the one thing that constantly eluded him was a place suitable to his needs. In 1843 he finally found a post as assistant rector at a church in Tarrytown. It took him another year to get a parish of his own, St. George's at Hempstead, Long Island.

    The marriage produced six children, all of whom survived. It says much about Cornelia's influence that the first son, John Neilson (1843), received her father's name while the second son, born a year later, got his father's unwanted name. Anna (1846) was named after Orlando's mother. Not until the fourth child arrived in 1848 did Orlando resort to the family store of prosaic names; he was called Edward Henry and in later years never cared much for either name. He was followed by Cornelia (1850) and William (1854).

    As in most small country parishes, the pay at St. George's was meager and often in arrears. As his family grew, Orlando found himself in a losing struggle to make ends meet. In 1849 he quarreled with his vestry over back salary still owed him. Shortly afterward a post as assistant rector opened up on Staten Island, but Orlando could not support his family with the pay. With prospects in the East so grim, he began looking for a place in the West. In 1850 he received an offer from a small parish in the California mountains, where the gold rush had created a frenzy of migration. Unable to find anything better, Orlando decided to try it.

    Cornelia Harriman must have blanched at the news. Her strong sense of family and social pride were firmly rooted in the East. That was where she and her children counted for something, where she hoped to see them prosper. In the West they would be one more batch of nobodies, and poor ones at that. If one had to be poor, better to be among family and friends who knew your social worth. Orlando understood these things, and he realized the perils offered by the trip itself. There were only three ways to reach California: the long overland trek, the still longer sea journey around Cape Horn, and the shorter sea journey with its dangerous overland hike through the jungle at the Isthmus of Panama. All of them required stamina and a healthy dose of good luck; for a family with small children the odds got much longer. Orlando could see only one way to manage it. Leaving his family in Hempstead, he sailed alone for Panama in May 1850.

    The rugged trip across the isthmus left Orlando weak and exhausted. He fell ill with fever and lay helpless for a month in Panama before he was strong enough to board a steamer for San Francisco. Once arrived in California, he was stunned to learn that the parish, having heard nothing from him for so long a time, had hired another minister. The next year sorely tested his faith in God as he wandered about the state, preaching in mining camps and raw frontier towns, founding a small church in Stockton, and braving a cholera epidemic to start another one in Sacramento.

    During those months everything was a struggle and nothing seemed permanent. Slowly, painfully, Orlando came to the harsh truth that there was nothing for him in California. Broken in health and spirit, he climbed aboard a steamer in March 1851 and endured the long journey back to New York. If, as his youthful essay stated, happiness consisted in large measure of contentment, Orlando was not a happy man. After a year's absence he came home to tell his anxious family that the whole adventure had been a dismal failure.

    The search for a place resumed. Orlando brought his family from Hempstead to a small house on Hamilton Square in Jersey City, where he found work for meager pay as a semiattached curate in one of the city's churches. While Orlando floundered, his brothers had commenced their careers in business. William and Edward joined their father in the family firm of William Harriman & Company, which had an office at 128 Front Street. Young Oliver started out as a commission merchant on his way to earning a fortune in dry goods.

    The family did what it could to help Orlando. In his earnest, fumbling way he grew desperate enough to try his hand at business in partnership with his brothers. During the early 1850s he juggled his duties as curate with work in the family firm, struggling to learn matters utterly foreign to him. When William's untimely death dissolved the firm in 1856, Edward continued it with Orlando as his partner. But Edward also had his own drug import company to run, and Orlando proved as inept in business as he had in managing his own affairs. The arrangement lasted only about a year before a chastened Orlando gave up the experiment and went back to the dreary hunt for a parish of his own.

    The search brought him two churches. So wretched was the pay at these small parishes that Orlando was obliged to take both, preaching at Clairemont in the morning and walking to West Hoboken every Sunday afternoon. After he had served for seven years, the West Hoboken church owed him nearly two years' back salary. Unable to collect more than verbal praise from his congregation, he left the post in October 1866.

    The pattern of Orlando's life had become painfully clear. While his brothers climbed steadily to prosperous careers, he failed at everything he tried except marriage. The needs of his own family threw Orlando onto the charity of both the Harrimans and the Neilsons. His ineptness doomed him to the role of poor relation in proud and distinguished families that could not have entirely concealed the disdain they felt over his bumbling. When he finally achieved some semblance of financial security well into middle age, it came in the form of a final humiliation: a modest inheritance left his wife by one of her relatives.

    It was only fitting that Orlando find himself dependent on his wife's family at the end. Through these years of tribulation it was Cornelia Harriman who kept the family together through sheer strength of character. Herself a creature of tradition, she impressed this sense of pride and place on all her children. Hardship, poverty, even humiliation could be borne so long as they remembered who they were and where they belonged. The worse their prospects, the taller they stood in defiance of them.

    While all the children absorbed this lesson, one learned it especially well. The rigors of a childhood in which the family was constantly dependent on the largesse of others left a deep imprint on Edward Henry Harriman. Two lessons in particular were drilled into his character: the importance of family sticking together and sustaining one another and the determination never to be dependent on others. He would never suffer the petty slights and humiliations endured by his father because he could not make his own way in life. Orlando was a good but impractical man in a world that belonged to the practical. His son would not make that mistake. Indeed, the third and perhaps most important lesson he absorbed was learning the importance of finding ways to get things done.

    Edward Henry Harriman never talked about these matters later in life when the public lusted greedily for details of his youth. The dogged efforts to cast his upbringing in the Horatio Alger mold got no help from him, but he revealed something of his feelings in a less obvious way. He named a daughter after his mother, but no son bore his father's name. To his thinking, the world had more Orlandos than it needed; certainly he wanted no more reminders of their presence.

    The child born February 25, 1848, to Cornelia Harriman would never be an imposing physical specimen. All his life Henry was the runt of the litter, a large-eared, weak-eyed bantam who made up in scrappiness what he lacked in size. Where others intimidated through size or strength, Henry did so through sheer force of will fueled by volcanic bursts of energy. An acquaintance from school days remembered him as "the worst little devil in his class, and always at the top of it."

    He was not much of a student except when he put his mind to it, and he seemed to excel at anything he put his mind to. At the public school in Jersey City he took more to sports than to books. When Henry was twelve, his parents scraped together the funds to send him to Trinity School in New York. Every day he rose at dawn, trudged to the ferry, crossed the river, and hiked another mile to school. Legend has it that the trip took him through the turf of some street toughs who let no newcomer pass unchallenged, but Henry learned to hold his own against them. Whether true or not, the image fits: Henry grew up streetwise in every sense of the term.

    Even this story stands out as an exception. The most striking thing about Henry's childhood is the absence not only of information but of legend as well. Several writers trying to strike the trail of Harriman's past in the 1900s could pry nothing out of his old friends and acquaintances about the early days. There seemed to be a conspiracy of silence led by Harriman himself for reasons that had nothing to do with modesty. A decade later Kennan encountered the same vacuum and managed to wring only dollops of information from family and friends. In the end he was forced to rely on the material gathered by Batson, who had not done much better.

    There is little doubt that Henry's childhood scarred him in ways he did not wish to confront later in life. He was the son of two aristocratic parents forced to endure a life below their station. One journalist seeking to unravel the Harriman mystery thought he understood what this meant: "Both [parents] had that terrible bane of the poor—pride of family. They lived in a haughty exclusiveness, teaching their children to follow social lines closely. As they grew older, and as they grew more comfortable, this feeling intensified; their circle narrowed, they knew few people, and cared to know no more. Within the circle the warmest feelings reigned, but to the world outside the Harrimans were cold, reserved, haughty."

    The Harrimans responded to this unpalatable mix of pride and poverty by drawing closer together, but the effect on Henry took quite another form. Despite the protection given by his mother, he could hardly escape the stigma of being a poor relation or miss the example of a father who, for all his erudition, had gone nowhere in life. Henry showed himself to be far more combative than his parents or any of his brothers. Something in the chrysalis of his childhood transformed these humiliations into a determination to succeed, to erase the blot on the family name with crushing finality.

    The obvious solution was to make enough money to ensure the financial security he had always lacked. For any Harriman the logical arena was business, where family and friends could be useful. School offered little to satisfy a restless and ambitious boy like Henry. After enduring Trinity for two years, he informed his father that he intended to quit and go to work. Orlando was appalled but could not budge the boy. To every objection Henry merely fidgeted impatiently and said, "I am going to work."

    But Henry did not simply enter the business world. Not for him the slow, steady climb up the rungs in a mercantile house, even though his uncles had done well at it. Instead he went straight to the fastest lane around: Wall Street. In 1862, at the age of fourteen, he started with a small firm, then got a place as office boy in the firm of DeWitt C. Hays, a broker who held membership number three on the New York Stock Exchange and later served as its treasurer for thirty years. After a brief stint as a messenger carrying securities in a bag to other firms, he became a "pad shover." These were boys who scurried from office to office with stock prices and buy-or-sell orders scribbled on pads of paper.

    In an age without tickers or electricity, the brokerage business was a gigantic paper chase. Being a pad shover offered any bright, alert boy the chance to observe every aspect of the business from the purely technical nature of how transactions were made to the psychology of behavior under stress as revealed by the men who gave and received orders. Henry found himself in a classroom offering lessons he was eager to learn, and he proved an apt pupil. In addition to possessing a keen eye for detail and a phenomenal memory, he proved himself trustworthy and reliable in a place where these qualities counted for everything.

    He had come to Wall Street at a momentous time. During the past decade the nerve center of American finance had undergone a revolutionary change. Thanks to the newfangled telegraph and the emergence of intercity express service, every major eastern city gained access to New York markets. Business news and stock prices became regular features in major urban newspapers. The California gold rush and an orgy of railroad construction had sparked a boom in mining and rail securities that sent the financial district into a speculative frenzy until the panic of 1857 flattened it.

    From the rubble of that disaster emerged a new breed of traders less genteel and more aggressive than the older generation they displaced. The newcomers flocked to New York from distant states, where they had piled up fortunes in mining or railroads or commerce, eager to try their hand in the biggest casino of all and willing to play for stakes that made older hands blanch. They knew little and cared less about the traditions of the street. For them the only two rules of the game were success and survival.

    Under any circumstances this new breed of trader would have changed the tone of Wall Street, but their arrival coincided with the most extraordinary event of the age. The Civil War plunged the country into a era of abnormality that proved an ideal training ground for a new generation of businessmen and speculators alike. Wall Street gamblers feasted on the uncertainties of war as every market twitched in tune to news from the battlefield. "The war," said one denizen of the street, "which made us a great people, made us also a nation in whom speculative ideas are predominant."

    Get-rich-quick mania swept Wall Street in epidemic form. All day long crowds of brokers swarmed through the stock, mining, and gold exchanges, flooding out onto the curb in their incessant quest for riches. At dusk, wrung dry and exhausted, they still did not quit but stalked the reading room and corridors of the Fifth Avenue Hotel until the exasperated proprietor evicted them. Since the stock exchange limited its membership and confined its trading to two sessions a day despite the enormous leap in volume, most of the action took place on the curb or in some place set up for continuous trading. Nothing short of the limits of human endurance slowed the ritual.

    As a result, Henry got his initiation to the street amid a school of sharks caught up in a feeding frenzy. By age twenty-one he had seen the market convulsed by war, Lincoln's assassination, Reconstruction, the feverish speculation over the relative values of gold and greenbacks, the Morse panic, the Harlem, Hudson, and Prairie du Chien corners, the Erie war, and Black Friday. From these episodes Henry gleaned enough material for an advanced course in finance and speculation. As tutors he had the machinations of such luminaries as Cornelius Vanderbilt, Daniel Drew, Jay Gould, Jim Fisk, the Jerome brothers, Anthony Morse, and Henry Keep.

    His own employer was a broker of the old school who survived through conservatism rather than daring. The dignified Hays, whose smooth, morose features were wreathed in straggly side-whiskers, thought enough of Henry's ability to make him managing clerk at a salary of $2,000 a year. This promotion merely spurred a growing desire to strike out on his own. He was hardly the type to be content in someone else's employ, and he had seen enough to believe that his future lay in Wall Street. Henry liked to be where the challenges were great, where victory went to the fleet of mind and staunch of heart. He had nerve, knew how to hustle, was indefatigable, and had accumulated a useful store of knowledge and acquaintances during his days as a pad shover.

    For role models he looked past his father to his uncles. Oliver was doing well in dry goods, Charles in imports and sugar refining, and Edward as a merchant and drug importer. During the war Uncle Edward had been a broker and gone partners with Larry Jerome, whose nimble mind and flashing wit made him a favorite on the street. When that partnership dissolved after the war, Edward had formed a new firm with his brother John and possibly James as well. But none of the Harrimans who tried Wall Street had yet left a mark. Here was Henry's chance to blaze a trail.

    On August 13, 1870, at the age of twenty-two, Henry became member 281 of the New York Stock Exchange. Memberships that year sold at prices ranging from $4,000 to $4,500, plus a $500 initiation fee. Henry did not have this much money in addition to capital for his new venture, so he borrowed most of it from his uncle Oliver. It proved to be the wisest investment Oliver ever made.

    There was something altogether fitting in the manner of Henry's debut as a broker. He joined the club on money rented from his family, and to succeed he would need more than a little help from his friends. Whatever capital he had came from those same sources. An old friend recalled Henry pulling a hundred-dollar bill out of his pocket just after he had opened his new office and shrugging, "Well, I can't lose much, anyhow; that's all I've got."

    But he knew what to do. Henry launched his career not as a lone wolf eager to prowl the treacherous haunts of the street with a keen nose but as one of the boys hoping to make their way in life by helping each another whenever possible. Short of cash but long on social connections, Henry learned early to maximize the assets at hand.