Cyrus McCormick returned to Chicago on June 1, 1848, after spending the spring in Washington defending his patents, to find a very impressive factory along the bank of the north branch in which his partner Charles Gray was busy at work with his part of the bargain, producing the 500 machines for the imminent harvest.  A few days later, Ogden began to lay his tracks to the west.  McCormick’s factory had already become the rave of Chicago, best described by the Chicago Weekly Democrat:

“This is truly a mechanical age, and probably nothing so distinctively marks the civilization of the present day as the state of perfection to which machinery is being brought… These remarks were suggested by a visit yesterday to the Reaping Machine Factory of Messrs. McCormick and Gray.  It is situated on the north side of the river near the piers; and is a well finished brick building, 100 feet by 30 or over and three stories high.  Attached to the main building is a building containing the steam engine, lathes for turning iron, and also a building containing six forges.  There are 33 hands employed in the factory, ten of whom are blacksmiths.

The steam engine [10 hp.] particularly attracted our attention… This engine drives some fourteen or fifteen machines; viz. a planing machine, two circular saws, a tenent saw, a lathe for turning handles for rakes, pitch forks, etc.; also two lathes for turning iron, a gage’s patent die, two morticing machines and two grind stones.  Machines are being set up for various other uses in several branches of carpenter’s work. The smithy contains 10 forges in all… We understand the proprietors design enlargening this portion of the establishment as it is at present too contracted for the wants of the factory.”

All was not, however, what it at first appeared to be upon McCormick’s arrival.  Gray was supposed to have mailed McCormick monthly financial statements, who upon receiving these was to have forwarded any necessary additional cash needed to help Gray with the manufacturing.  McCormick apparently had received no communications whatsoever from his partner and had assumed that the $2500 in patent fees that Gray had still owed him from the 1847 season had been sufficient to cover any additional costs incurred by Gray during McCormick’s absence.  Meanwhile, Gray apparently had second thoughts about his involvement in such a large business undertaking, especially as the early winter of 1847-8 had progressed in a markedly disadvantageous way for the promise of the upcoming wheat season.  Fearing a potential financial debacle if the harvest proved to be a bust, Gray had approached Ogden in January in “great need of capital” to continue the fledgling operation, misrepresenting the situation by stating that McCormick was not holding up his part of the contract by forwarding the necessary funds already expended by Gray in the construction of the factory.  Instead of securing a loan sufficient to continue the operation, however, Gray apparently chose to hedge his bet by reducing his potential liability from a poor harvest by selling half of his interest in the company to Ogden for $7000 (netting a $6,000 profit), without ever consulting McCormick. 

As McCormick arrived in Chicago in June 1848, he not only had a new factory, but also a new partner, although as he stepped off the boat, he was apparently unaware of this fact.  Even as production of the reapers continued apace into the summer in order to meet demand, both Gray and McCormick lined up their arguments in anticipation of legal action.  At the end of the very successful season (McCormick had netted over $30,000 from the Chicago operation alone), the two partners agreed on September 25, 1848, to submit their differences to arbitration, and assigned to Ogden the responsibility of collecting the outstanding debts.  On the same day, Gray also shed himself of McCormick’s iron will by selling his remaining quarter interest in the factory to Ogden, who now owned half of the reaper operation.

FURTHER READING:

Andreas, Alfred T. History of Chicago. 3 vols. Chicago, 1884-1886. Reprint, New York: Arno Press, 1975.

Harpster, Jack. A Biography of William B. Ogden. Carbondale: Southern Illinois University, 2009.

Hutchinson, William T. Cyrus Hall McCormick- Harvest: 1856-1884, New York: The Century Co., 1930.

Pierce, Bessie Louis. A History of Chicago- I,II. New York: Knopf.  1940.

Young, David M., The Iron Horse and the Windy City, DeKalb: Northern Illinois University Press, 2005.

(If you have any questions or suggestions, please feel free to eMail me at: thearchitectureprofessor@gmail.com)

Consequently, Ogden understood that not only would no financial assistance ever be coming from Boston, no matter his prior political connections with New York or how cordial the relations he may had struck with Brooks, but that he would, more than likely, also have to find an alternative railroad company that he could better rely upon for a more favorable connection to the east for the G&CU.  Determined not to fail in the face of Weld’s smug dismissal, Ogden and Scammon were forced to build the Galena in a “pay as you go” manner with what little money they raised from stock subscriptions that they and their partners were able to procure from farmers along the proposed route.  They continued their fund-raising (begging) efforts during the winter and by spring, enough stock had been subscribed that the first construction contracts for the line’s first 32 miles were let on March 1, 1848.  As had been the case with the canal, profits from construction contracts would be more immediately available than those from the operation of the railroad, and Ogden had set up a company, McCagg, Reed, and Co. in which he was a silent partner, to provide the wood ties and rails (that were topped with iron strap ribbons) from his own forests in Wisconsin.  Twenty-one year-old Ezra Butler McCagg had just arrived in Chicago from Kinderhook, NY, where he had recently completed his law degree.  (Kinderhook was also the birthplace of Martin Van Buren and Charles Butler, that, together with McCagg’s middle name, Butler, his mother’s maiden name, suggests that he may have been related to Charles Butler.)  

The facts of McCagg’s move to Chicago suggest that he was brought to Chicago by Ogden to replace Norman B. Judd’s position in Scammon’s law firm.  Judd, a lawyer who had studied law in Rome, NY, had been invited to move to Chicago in November 1836 by one of his old classmates, Judge John D. Caton, to be his partner.  He quickly made the acqaintence of William Ogden and in the city’s first election that saw Ogden rise to be elected Mayor in 1837, Judd was elected the City Attorney, a position he held for two years, until Caton moved out of town in 1838.  Judd remained in Ogden’s inner circle by becoming Scammon’s law partner, a position he had held until Ogden decided to realign his business plans from the MC to a company whoe goals were more aligned with his own, at which time Judd was spun off to become the corporate attorney for that company, the Michigan Southern.  During Judd’s partnership with Scammon, he had also moved into Illinois politics, being first elected to the State Senate in 1844, a position he held for the next sixteen years, providing a critical connection within the Illinois government during Ogden’s rise in the railroad industry.  McCagg’s move to Chicago had also, therefore, positioned him to be conveniently used by Ogden as a front man for some of his other business ventures (such as McCagg, Reed and Co.) when needed without an obvious appearance of a conflict of interest suggested by the name Ogden appearing on a company’s letterhead.  (Following the death of Ogden’s partner and brother-in-law, William Jones in 1851, McCagg would even marry Jones’ widow, Ogden’s sister Caroline in 1854.) 

Ogden then followed up the letting of the first G&CU contracts with an overly-optimistic annual report to the company’s stockholders on April 5, 1848, in which he laid out his overall vision for Chicago’s first railroad:

“It cannot have escaped the observation of all acquanted with the region of the country to be affected by the construction of this important work, that, if constructed now and extended east from Chicago around the head of Lake Michigan till it meets the Michigan Central Railroad, as it soon will, it secures to the country through it passes the Great North-Western railroad thoroughfare for all time to come [the italics were by Ogden].”

Ogden also threw out a few crumbs to his Wisconsin supporters by stating that the used strap-iron rails that would be used to begin the G&CU, would eventually be reused in laying the track for the Rockford to Beloit branch, once the main line was replaced with rolled iron rails. Nonetheless, local opposition to the Galena was still coming from all directions.  Common Council still had to give its approval to build tracks within the North Division.  Even though Ogden, who had been the city’s first mayor, had run and been elected in early 1847 as an alderman, undoubtedly to assist the railroad’s approval process, he failed to get a right-of-way ordinance passed as members from the West Division sought to keep the train from crossing the North Branch to Ogden’s property in the North Division. Meanwhile, the company had managed to secure some old strap rail from the Rochester & Tonawanda that was being replaced with rolled iron T-sections.  To the satisfaction of all who had worked so long and so hard, especially Ogden and Scammon, construction on the G&CU began in June 1848 heading not east to meet the MC but due west, barely two months after the completion of the canal.  (It bears repeating the scale of the gamble Ogden was taking in this move, for there was not a railraod track within a hundred-mile radius of Chicago.) Thus, Ogden and his iron horse struck out on their twenty-one year westwardly trek from Chicago toward their ultimate destination, the Pacific Ocean, proceeding only on a “paycheck-to paycheck” existence.

FURTHER READING:

Andreas, Alfred T. History of Chicago. 3 vols. Chicago, 1884-1886. Reprint, New York: Arno Press, 1975.

Harpster, Jack. A Biography of William B. Ogden. Carbondale: Southern Illinois University, 2009.

Lorenzsonn, Axel S. Steam and Cinders: The Advent of Railroads in Wisconsin: 1831-1861.    Madison: Wisconsin Historical Society Press, 2009.

(If you have any questions or suggestions, please feel free to eMail me at: thearchitectureprofessor@gmail.com)

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.  

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.”)

FURTHER READING:

Andreas, Alfred T. History of Chicago. 3 vols. Chicago, 1884-1886. Reprint, New York: Arno Press, 1975.

Harlow, Alvin F. Steelways of New England. New York: Creative Age Press, 1946.

Hutchinson, William T. Cyrus Hall McCormick- Harvest: 1856-1884, New York: The Century Co., 1930.

Johnson, Arthur and Barry E. Supple. Boston Capitalists and the Western Railroads. Cambridge:     Harvard University Press, 1967.

McLellan, David and Bill Warrick, The Lake Shore & Michigan Southern Railway, Polo, IL: Transportation Trails, 1989.

Pierce, Bessie Louis. A History of Chicago- I,II. New York: Knopf.  1940.

(If you have any questions or suggestions, please feel free to eMail me at: thearchitectureprofessor@gmail.com)