Bold Endeavors by Felix G. Rohatyn

Author:Felix G. Rohatyn
Language: eng
Format: epub
Published: 2019-03-25T16:00:00+00:00

THE SIERRA NEVADAS WERE rough, forbidding country. The mountain route was always a challenging adventure for settlers making their way west. And there were times when it was something worse. In 1846, after a heavy snow fell on Donner Pass and blocked the passage, a stranded party of California-bound pioneers ate the remains of their dead fellow emigrants to survive.

In 1860, following his return from Washington, a disap pointed, increasingly frustrated Judah found himself trekking by the Donner Pass. Dr. Daniel Strong, a druggist who lived in a nearby mining town, had asked Judah if a stage road could be built over the infamous trail; and Judah, always curious, agreed to go along and inspect. But when Judah stood on a ridge that looked down at Donner Lake, his thoughts were not about stagecoaches. He saw at once the precise route for his railroad. Tracks, he realized with excitement, would only need to cross the crest of the mountains a single time—not twice as he had plotted in the maps he had displayed in Washington.

Inspired by this time and money-saving shortcut, he and his new partner, Dr. Strong, quickly drew up papers to incorporate the Central Pacific Railroad. Only now they needed to raise the $11,500 incorporation fee required by California law.

To attract investors, Judah dashed off a pamphlet detailing his plans for a Pacific rail link through the Donner Pass. The logic of his proposal, coupled with the recent election of Lincoln, a famously ardent supporter of a transcontinental line, would, Judah felt confident, make raising money easy work. But months passed; in the end, only $7,000 had been pledged—a sizable $4,500 less than was required.

Judah refused to give up. Instead, he went to the boomtown of Sacramento to look for new, deep-pocketed investors. Collis Potter Huntington, a local merchant, and his partner, Mark Hopkins, had prospered selling tools and mining equipment to the prospectors who had flocked to California in the 1849 gold rush. Their fortunes continued to grow after canny investments in toll roads and the telegraph. Now Judah tried to persuade the two men that money could be made by supporting his railroad. As a further in ducement, a desperate Judah promised that in addition to building his rail line he would also construct a wagon toll road to the Nevada mines for Huntington.

The opportunity to control a transcontinental railroad for a relatively small investment was, Huntington decided, worth the risk. He and Hopkins put up an initial $1,500, and then they raised the same amount from two other wealthy Republican Sacramento merchants, Leland Stanford and Charles Crocker.

Judah celebrated. He now had the money he needed to incorporate. But in time he would regret that he had turned to these Sacramento merchants. They would become known as the “Big Four,” and they would soon be infamous for the inventiveness and scale of their corruption.

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