7.7. McCORMICK MOVES FROM CINCINNATI TO CHICAGO

Always one to plan ahead, McCormick decided to consolidate his business in Chicago after the 1847 harvest, if all went well with Chicago’s Charles Gray. In addition to a potentially reliable manufacturer, with the completion of the canal slated for early 1848, Chicago also appeared to offer a better transportation network than Cincinnati’s Ohio River system. This coincided nicely with McCormick’s timetable for shipping the planned production. In need of a knowledgeable attorney in Chicago to consummate any contractual relationship, McCormick asked Rep. McDowell of Virginia for a letter of introduction to Illinois’ newly-elected Senator Stephen A. Douglas, who himself had just moved to Chicago.

In the 1846 national election, Douglas had been elected to the U.S. Senate, joining his former Supreme Court colleague, Sen. Sidney Breese. He subsequently had moved his family from Quincy, IL, in his former Congressional District to Chicago during the summer of 1847. Douglas willingly obliged McCormick’s request with a letter to his Chicago lawyer friend, Ebenezer Peck, (an associate of Ogden’s) who agreed to draw up the necessary papers for McCormick’s partnership with Gray, following Gray’s satisfactory production in 1847 of the 100 machines. Ogden, quite assurdedly couldn’t believe his luck when he was informed by Peck of the Virginaian’s plan to build a factory in Chicago. Sale of shares of the G&CU had gotten off to a poor start on August 10, 1847. Only twenty days later, the contract that brought from Cincinnati to Chicago what was to eventually become the largest factory of its kind in the country was signed on August 30, 1847.

The First McCormick Reaper Factory, northside of the mouth of the river. The Galena & Chicago Union tracks have been laid to service the factory. (Online)

McCormick and Gray initially each put up $2000 in capital with which three lots on the north bank of the river’s Main branch, east of the Lake House and as close to the lake as feasible, were purchased from Ogden, for the erection of a factory with a planned capacity of 500 reapers for the 1848 harvest (an incredible five times the number Gray had made the previous year). The location on the river not only assured McCormick of the direct loading of his reapers onto boats for shipment either to the east via the lake or to the west via the canal, as well as the direct receiving of bulk raw materials needed for manufacturing without paying a transfer charge. The costs incurred in setting up the factory and manufacturing the 500 machines were to be shared equally by the partners, as were the net profits at the end of the 1848 harvest. Ten days after finalizing these arrangements, McCormick left Chicago on September 10, 1847, to pursue his patent extension case in Washington, confident that he had made the right decision in choosing Gray as his partner and moving his company from Cincinnati to Chicago as the location to centralize his operations. He planned to return in the summer of 1848 to view his new factory and the 500 reapers that his new partner was contracted to construct. When he would return, he would find that Ogden was laying the G&CU tracks to the west, but on a line that could extend directly to his factory.

7.8. BOSTON SPRINGS THE TRAP

Sometimes during their summer campaign to sell G&CU stock, Ogden and Scammon had crossed paths with the MC’s John Brooks and informally agreed that their two lines were made to meet in Chicago. They took it upon themselves in October 1847 to take over a defunct line in Indiana, the Buffalo & Mississippi (B&M), with Ogden taking the position of President. The B&M was chartered to construct its tracks in Indiana, exactly what was needed to bring the MC into Illinois. Ogden and Brooks also signed an agreement that gave the Michigan Central the right to use the provision in the G&CU’s charter that permitted it “to unite with any other rail road,… and also to construct such other and lateral routes, as may be necessary to connect them with any other route…” Ogden was already projecting, at this early date, a route directly to Council Bluffs, that offered a strategic railroad connection to steamboats via the Missouri and Platte Rivers. It was the exact route that Douglas had propsed only two years earlier. Ogden and Brooks were, therefore, already planning for the next section in the Boston route to the Mississippi. Having made what they considered to have been a good faith commitment with the Michigan Central through Brooks, Ogden (who had also worked with a number of its Bostonian directors on the canal project and, therefore, assumed they were allies) and Scammon traveled during the winter of 1847-48 to Albany and Boston in order to enlist financial support for the G&CU from the directors of the MC, whom they now considered to be business partners. (It is quite possible that Ogden had received encouragement from his client Samuel Russell to approach John Murray Forbes, the President of the MC as had his older brother, Robert Bennet Forbes, was the head of Russell & Co.) They were cordially greeted by Forbes and William Fletcher Weld, another of Boston’s shipping magnates who had made the transition from ships to railroads, but returned with nothing but a sobering rebuff and a patronizing sermon on the Bostonians’ view of the world. Weld was brusquely forthright in his response to the request made by the novice Westerners, who should have remembered how the Illinois & Michigan Canal was being completed at that very moment:

“Gentlemen. I do not remember any enterprise of this kind we Boston people have taken hold upon statistics. You must go home, raise what money you can, expend it upon your road, and when it breaks down, as it surely, or in all probability will; come and give it to us, and we will take hold of it and complete it, as we are completing the Michigan Central.”

Ogden and Scammon had been double-crossed by the wily Bostonians. It seems curious that Ogden fell for such a scheme when the Bostonians had used the exact same stretegy to take over the canal. We can surmise whether Brooks was part of this scheme when he had agreed to join Ogden in buying the B&M in Indiana, or had also been duped by his superiors. The Bostonians, however, had greatly underestimated Ogden’s business and political connections, prior experience, and tenacious personality, that would eventually cost them dearly. (Scammon would later in life reveal that upon their return to Chicago, “a resolution was then formed though never publicly expressed, that the Galena should not break down.”)