3.11. WILLIAM OGDEN IS SENT TO CHICAGO

I consider William Ogden to be “The Man who made Chicago Chicago,” so it is central to my story to understand Ogden’s background before his move to Chicago. As Arthur Bronson’s associate, Charles Butler, returned home following his inspection of the proposed canal, he had more pressing personal concerns. He had married Eliza Ogden, the oldest of five children in a family from Walton, NY, in 1825. The older of her two brothers, William, (born 1805) had been forced at the age of sixteen in 1821 to take over the management of his father’s businesses, that included a number of timber, flour, and woolen mills, after their father first suffered a stroke and then had died some two years later. William had been quite successful in building up the businesses, especially in the face of competitors in the northern section of the state who had gained an economic advantage with the completion of the Erie Canal. He felt sufficiently financially secure in 1829 to finally ask his childhood sweetheart, Sarah North, to marry him, but she subsequently succumbed to pneumonia not long after she had accepted his proposal. Ogden had since languished in depression over the past three years from the loss of his one true love, going aimlessly through the motions of life without any real interest in the future. No one knew this better than his sister Eliza and her husband Charles, who was about to attempt to jumpstart his brother-in-law’s passion for life.

In his biography of William Ogden, Jack Harpster made a convincing argument that Butler’s attempt to restore the purpose in Ogden’s life was to have ramifications way beyond those of his original objective. The New York & Erie Railroad had lain stillborn since its initial charter by the New York Legislature in April 1832. The 1832 Presidential election had elected Martin Van Buren as Pres. Jackson’s Vice-President. Van Buren’s law partner, Charles’ older brother Benjamin, would be named in November 1833 to replace Roger Taney as the U.S. Attorney General following Taney’s failure to be confirmed as the Treasury Secretary by Jackson’s opponents in the Senate as a rebuff to the President’s unilateral action against the Second Bank of the United States (2BUS). Following his election, Vice-President Van Buren, still the leader of the Albany Regency political machine, was now committed to getting the State legislature to approve an additional loan guarantee so that construction of the Erie Railroad could begin, that had so far languished in committee due to the influence of politicians along the route of the Erie Canal who opposed the railroad in the south. Ogden had experienced, firsthand, the economic changes wrought by the Erie Canal, to which he had no geographic access, while a railroad in the southern portion of the state would offer similar advantages to his property and restore his economic competitiveness.

Harpster had reconstructed the events that led to Van Buren and Benjamin Butler to identify Ogden, obviously through the recommendation of Charles Butler, to be the man to run for the State Assembly during the upcoming 1834 election so that he could make a speech during the 1835 session that might turn the tide in favor of the Erie Railroad. Harpster speculated that Charles had invited his moribund brother-in-law to a secret meeting somewhere in the Hudson Valley during 1833, that included his brother and Van Buren, in which the Vice President “made him a deal he couldn’t refuse:” that he run for the Assembly seat from Delaware County under Van Buren’s Democratic Party. Charles knew that Ogden would have no real alternative but to agree, hoping that the political campaign would reignite the twenty-eight year old’s lust for life. Ogden was successful in the 1834 campaign, but before he was to deliver his speech in the Assembly on March 21, 1835, the Erie’s opponents had forced the vote to be rescheduled a day earlier, in which they once again rejected any further funding for the Erie. Unbowed, Ogden still stood in the Assembly the next day and delivered his reasoning for such funding:

“The importance of proceeding without delay… must be apparent to every one; for if the business of the western states should be diverted from us, [by the railroads then being constructed by New York’s competing ports] it would be difficult, if not impossible, to regain it by any subsequent exertions… I see continuous railways from New York to Lake Erie… and south through Ohio, Indiana, and Illinois to the waters of the Mississippi, and connecting with railroads running to Cincinnati and Louisville in Kentucky, and Nashville in Tennessee, and on to New Orleans. They will present the most splendid system of internal communication ever devised by man.”

Although the issue had been defeated the day before, Ogden’s speech had the effect Van Buren had hoped for in that the funding for the Erie was approved by both houses in the upcoming fall session.

Meanwhile, Charles Butler, after his trip with Bronson to Chicago in 1833, appears to have become fixated on real estate speculation, contrary to his earlier nature, and in February 1835 purchased Bronson’s 182 acres in Chicago along the north bank of the river for $100,000 (a 400% profit) with funds he had obtained collectively from a group of seven friends that included his brother as well as his brother-in-law. He then relocated from Geneva, NY, to New York City and organized the American Land Company, of which he placed himself as president. He then initiated the second phase of his campaign to reignite his brother-in-law’s purpose in life: he asked Ogden to travel to Chicago in order to prepare the land for sale and to supervise its sale in May 1835 after the Federal government started auctioning the newly-acquired Native lands, and in June when the state was to commence selling canal lots, hoping these two events would generate a large crowd of interested speculators. Having performed the sole task that he had been asked to do by the Vice President, Ogden resigned his Assembly seat so that he could travel to Chicago in May 1835 so that he could manage the sale of the land that his brother-in-law had bought from Bronson.

3.12. THE CANAL LAND BOOM

Ogden arrived in Chicago in late May 1835 and first met with Bronson’s brother, Frederick, who had been sent to Chicago by his older brother before he had made the decision to sell the land to Butler, to legally transfer the title of the property at the Federal Land Office on Lake Street, near Clark. Ogden then set about preparing, albeit somewhat skeptically, the property for auction. The standard method of land speculation at the time was to purchase the land with a minimum down payment, using a mortgage to finance the balance of the transaction. Once the land had increased in value, a portion of the original real estate was resold at the higher value in order to discharge the mortgage, leaving the purchaser in sole ownership of the remaining land without any cost to himself, for all practical purposes, the speculator would gain ownership of the land at no cost. Ogden was astonished when he had sold only one-third of the land, because he had already recouped the entire purchase price. Fired by the optimism generated by the new canal bill and funded by Jackson’s distribution of Federal monies to regional banks that was part of his battle plan with the 2BUS, the town’s land prices had gone wild with speculation. What Bronson had bought in the summer of 1834 for $20,000 would be worth $500,000 two years later in September 1836.

Before Ogden started his return trip to New York, however, he made a quick inspection trip up Lake Michigan and into Green Bay, finally stopping at Fort Howard, WI, located at the mouth of the Fox River into Green Bay (the town of Green Bay would not be incorporated until 1854). He had heard talk of the timber resources in upper Wisconsin and wanted to see for himself if the area had any real timber investment potential. With his lumber experience he would have pleasantly smiled as the steamboat plied the wooded shores of Green Bay. This may have been the final event that convinced Ogden to move to Chicago and begin a new phase of his life, for over time, he would own most of the forests in the area that centered around the small lumber company town that he would build and name Peshtigo, Wisconsin. On his return trip to Chicago, he made the acquaintance of two men who would become his oldest friends and business associates, Walter Newberry, Bronson’s land agent in Chicago, and lawyer J. Young Scammon. Scammon was a twenty-three year-old lawyer from Maine who was moving to Chicago to make his fortune. Within a week of his arrival, Scammon was hired as the deputy of the circuit court clerk.