James J. Hill

American railroad and shipping magnate

• Born: September 16, 1838
• Birthplace: Rockwood, Upper Canada (now in Ontario, Canada)
• Died: May 29, 1916
• Place of death: St. Paul, Minnesota

Hill began his career shipping merchandise on a small Minnesota railway, and he eventually owned railroads throughout the upper Midwest, Great Plains, and Pacific Northwest. The influence of his rail lines in these areas of the country earned him the nickname the Empire Builder.

Sources of wealth: Railroads; shipping; investments

Bequeathal of wealth: Spouse; children; charity

Early Life

James Jerome Hill was born into a Scotch-Irish family in southern Ontario, Canada. He had a happy childhood on the farm, surrounded by extended family. At age seventeen, he went to St. Paul, Minnesota, landing by boat there on July 21, 1856. He got his first job as a shipping clerk, then called a “mud clerk.” Hill worked hard on the levee in St. Paul, where steamboats arrived and employees loaded and unloaded tons of goods. Many supplies were headed north after traveling along the oxcart trails in the Red River Valley. Carts would come down the trail in June with furs, hides, and pelts and return with winter supplies for valley residents and the military. The growing population and farming enterprises of the valley and the supplies needed at Fort Garry, located in what is now Winnipeg, Manitoba, kept up the demand for supplies that landed on the levee in St. Paul.

First Ventures

After seven years in St. Paul, Hill opened his own warehouse on the Mississippi River. He began a shipping business that continued for twenty years. Hill transported flour from Minneapolis mills and other freight, as well as immigrants and passengers, along the cart trails. Instead of oxcarts, however, he used the latest technology of wagons, steamboats, and flatboats. Hill began a pattern of development that would serve him well in many endeavors. He was always interested in doing something better, faster, or more economically than his rivals. He read everything he could on a topic and kept up with the latest news. He traveled extensively and built strong social relationships with colleagues. He fearlessly broke new ground where commerce did not exist before.

Norman W. Kittson, who opened a trading post in Pembina, North Dakota, in 1843, shipped furs with Hill and then turned over the business to him. From about 1856 to 1870, a good portion of the furs traveling east through St. Paul were buffalo robes. Hill would broker goods like these, whether from the United States or England, traveling east or west, from the point of purchase to their destination. He would personally involve himself in all correspondence connected to the purchase and sale of this merchandise.

In the early 1870’s, Hill used more sophisticated forms of transportation to eliminate competition from the powerful Hudson’s Bay Company, a Canadian-based firm that dominated trade in the Red River Valley. He shipped goods by rail from St. Paul to St. Cloud, Minnesota, then by stage to the Red River, and then moved merchandise north by steamer to Winnipeg. The Hudson’s Bay Company, by comparison, trekked in goods by oxcart between Fort Garry and the new settlement in Pembina. Hill eliminated the need to use oxcarts, building a railroad to travel between St. Paul and St. Cloud that was a cheaper and more efficient means of transportation. The route from the South to the Great Lakes to St. Paul to St. Cloud surpassed the Hudson’s Bay route to the Red River Valley from the north.

When the Northern Pacific Railway declared bankruptcy during the Panic of 1873, Hill took control of this line and began to build a major railroad empire. He continually improved his rail lines, installing heavier rails, increasing tonnage per car, and lowering rates, and these actions would enable him to compete successfully with other railroad magnates and to survive the Panic of 1873.

Mature Wealth

In 1878, Hill and four other investors purchased the St. Paul & Pacific Railroad, which had gone bankrupt. Renaming it the St. Paul, Minneapolis & Manitoba Railway, the investors profited from its running to St. Cloud, where it joined with the Red River Valley and northwestern trade routes. Encouraging immigrants to travel on the railroad proved to be a stabilizing factor for the line, establishing the location of clients along main routes and branches who guaranteed continued business dealings.

In 1880, Hill became an American citizen. However, he was instrumental in developing the Canadian Pacific Railway from 1880 through 1883. Hill took a position with the railroad, helping to reorganize it out of bankruptcy. The Canadian Pacific’s westward expansion would parallel the westward extension of Hill’s other railroads. He continued to attract new business partners and relationships because those businesses profited by association with his railroads.

The St. Paul, Minneapolis, & Manitoba Railway kept growing. When Hill became president of the line in 1882, it went as far west as Montana. Hill renamed the line the Great Northern Railway when he became president and chairman of the board in 1890. By 1893, the westernmost point of the line had extended to Seattle, Washington, and the railroad connected this city with Minneapolis and St. Paul.

The success of his rail lines financed many of Hill’s other profitable ventures, including companies involved in agriculture, milling, banking, finance, and coal. He knew that England’s successful economy was tied to the cheap and efficient transportation of coal as the preferred fuel for home heating and iron production, so he worked with Pennsylvania coal producers through sales agents in Chicago. He replaced wood with coal as a source of fuel for his rail engines and other businesses. He insisted that his railroads have reputations of reliability and efficiency, which was a source of pride for him. His gutsy, feisty business acumen was matched by his strong work ethic and brilliant economic maneuvering. He was respected by friends and competitors alike.

At the beginning of the twentieth century, Hill purchased the Chicago, Burlington & Quincy Railroad. In 1904, he attempted to unite his three large railways—the Great Northern, Northern Pacific, and Chicago, Burlington & Quincy—but the U.S. Supreme Court prohibited this move. However, these railroads did merge in 1970 to form the Burlington Northern Railroad.

Hill’s son Louis took over the chairmanship of the Great Northern Railway when Hill retired in 1912. While in retirement, Hill bought and merged two banks and then brought Louis into the banking business.

Hill’s wealth was evident in the lifestyle that he and his family enjoyed. He and Mary Hill were married in St. Paul by Bishop John Ireland in 1867. The couple had ten children: Mary Frances, James Norman, Louis, Clara, Katherine (who died as an infant), Charlotte, Ruth, Rachel, Gertrude, and Walter. In addition to the family’s mansion, Hill House, in St. Paul, the Hills maintained a New York town house and a home in Paris. Their properties in or near St. Paul included the five-thousand-acre North Oaks farm, a summer home, which later provided land for the city of North Oaks, Minnesota. Hill owned two other farms in the Red River Valley.

Hill’s large family would travel abroad, attend school in the East, and winter in at the Jekyll Island Club in Georgia. Club members included J. P. Morgan, a fellow financier and loyal supporter of Hill. Hill’s yacht, the Wacouta, was used to take him on summer trips to his lodge in Quebec, where he fished for salmon on the St. John River. Hill died in 1916 at the age of seventy-seven.

Legacy

Hill’s Great Northern Railway opened the Pacific Northwest to transportation and commercial development from the east. His railroad and shipping business exerted economic dominance not only in the Pacific Northwest but also in the upper Midwest and the Great Plains.

Another of Hill’s achievements survived after his death. Hill House was declared a National Historic Landmark in 1961. The residence, which Hill constructed from 1888 to 1891, had its own power plant, pipe organ, art gallery, and electric lights and contained thirty-six thousand feet of living space. The Minnesota State Historical Society acquired Hill House and renovated it during a five-year period beginning in 1979, financing the rehabilitation with state, federal, and private funds. The home is open for public tours and events.

Hill was a generous philanthropist who wanted to elevate public knowledge. He donated the funds for a public facility, the James J. Hill Reference Library, which continues to operate in the twenty-first century. He donated millions of dollars to found the St. Paul Seminary, construct the St. Paul Hotel, and help establish Macalester College. He also made contributions to the Little Sisters of the Poor and other charities.

Bibliography

Frame, Robert M., III. James J. Hill’s St. Paul: A Guide to Historic Places. St. Paul, Minn.: James Jerome Hill Reference Library, 1988. Ties Hill’s business growth to physical landmarks that remain in St. Paul, Minnesota, and elsewhere. Photographs and architectural drawings accompany the location descriptions.

Hedges, James Blain. Henry Villard and the Northwest Railways. New Haven, Conn.: Yale University Press, 1930. An account of Villard’s long battle with Hill’s Northern Pacific for control of coal and transportation routes in the Northwest.

Hill, James J. Highways of Progress. Garden City, N.Y.: Doubleday, Page, 1912. Hill’s theories and observations regarding land stewardship, natural resources, and nature are accompanied by data and statistics.

Johnson, Craig. James J. Hill House. St. Paul, Minn.: Minnesota Historical Society Press, 1993. A history of the Hill family’s largest home and its unique design, enhanced by anecdotes and stories of the personal lives of its famous inhabitants and their neighbors, friends, and servants.

Martin, Albro. James J. Hill and the Opening of the Northwest. New York: Oxford University Press, 1976. A lively, unbiased narrative about Hill’s life and times.

Pyle, Joseph Gilpin. The Life of James J. Hill. 2 vols. New York: Doubleday, 1968. Hill commissioned this official biography while he was alive, and it originally was published in 1917. Describes Hill’s major business transactions, battles with government officials, setbacks, and victories to detail how he built his fortune.