Leland Stanford

American railroad builder and politician

• Born: March 9, 1824
• Birthplace: Watervliet, New York
• Died: June 20, 1893
• Place of death: Palo Alto, California

As president of the Central Pacific Railroad, Stanford guided the project that produced the nation’s first transcontinental railroad; he also founded California’s Stanford University.

Early Life

Amasa Leland Stanford was the son of a versatile Yankee who combined farming, innkeeping, and contracting on local road and canal projects. In 1836, Josiah Stanford moved the family to a farm on the Albany-Schenectady turnpike, where the young Stanford and his five brothers observed the westward migration pass directly in front of their home. This Western exodus and his father’s contracting business greatly influenced Stanford and helped to inspire him in his later railroad pioneering ventures.

Educated in local public schools and by itinerant tutors, Stanford enrolled, at the age of seventeen, in the small and racially integrated Institute of Science and Industry in Whitesborough, New York. Unhappy with its limited curriculum, he soon transferred to another school near Utica, New York, before settling at the Methodist Cazenovia Seminary near Syracuse. There, he became an active member of the debate society; became interested in the Whig politics of his hero, Henry Clay, the spokesperson of a national program of internal improvements; and kept up a steady correspondence with his father on the latter’s newfound interest in railroads. By the spring of 1845, Stanford quit school to apprentice at an Albany law firm and was admitted to the bar in 1848.

In the same year and with his law credentials now established, Stanford left Albany and traveled West, first to Chicago and then, by year’s end, to Port Washington, Wisconsin, almost twenty miles due north of Milwaukee. In the nation’s newest state, Stanford prospered and earned more than a thousand dollars in his first year on the frontier. He continued his earlier political interests and ran unsuccessfully as a Whig candidate for county district attorney. He then returned to Albany briefly in 1850 to marry Jane Lathrop, the daughter of a substantial Albany merchant, whom he had met in his law apprentice days. They returned to Port Washington, where he practiced law for another two years before becoming restless and dissatisfied with his profession.

In 1852, Stanford left Wisconsin, determined to start again in gold rushCalifornia. Again returning to Albany before the journey west, he encountered unrelenting opposition from his wife’s father, who forbade her from accompanying her husband to the wilds of California. Bowing to his father-in-law’s demands, Stanford sailed from New York City without his wife in June, 1852. Thirty-eight days later, after a passage through the Nicaraguan isthmus, Stanford arrived in San Francisco on July 12 and quickly moved on to Sacramento, the gateway to the gold country.

All five of the Stanford brothers had already preceded him to California and had established themselves in a loose-knit network of mercantile ventures. The Stanford clan understood early that more gold could be extracted through storekeeping than through gold-panning. Indeed, one of the brothers, Charles, had returned to Albany to serve as purchasing agent for the Stanford family’s expanding commercial enterprises in California. Stanford soon opened a store of his own, first in the town of Cold Springs, then in the boomtown of Michigan Bluff, which, in 1853, had grown from a population of thirty to two thousand. Because of his previous law experience, Stanford was soon elected the town’s justice of the peace, his only elective office until his 1861 gubernatorial victory.‘

In 1855, upon the death of his father-in-law, Stanford was finally able to bring his wife to California. In the fall of that year, they relocated to Sacramento and built a store valued at fourteen thousand dollars. Now fond of the substantial, he had quit the goldfields for good. He was no longer a storekeeper but a prosperous merchant who was supplementing his income by numerous profitable investments in mining ventures.

As a gentleman of property and standing, Stanford next turned to politics. In the 1856 presidential election year, Stanford became an active organizer for the infant Republican Party. As a delegate to the party’s first statewide convention, he endorsed its demand for the building of a Pacific transcontinental railroad. In the spring of 1857, he was an unsuccessful candidate for Sacramento city alderman and in the fall lost a race for state treasurer. Despite these defeats, Stanford had firmly established himself in Republican Party circles and was nominated for governor in 1859. The Democratic Party dominated California politics, and Stanford won less than 10 percent of the votes. National events, however, were rapidly changing the state’s political picture. By 1861, the California Republican Convention, now greatly encouraged by Abraham Lincoln’s election, nominated Stanford again. The fall gubernatorial election closely paralleled the presidential race of the previous year, and Stanford was elected by defeating a badly divided Democratic Party.

Life’s Work

Inaugurated governor in January, 1862, Stanford began to merge his two new careers, politics and railroading. Since June of the previous year, Stanford had been president of the newly formed Central Pacific Railroad of California. Indeed, while he discharged his gubernatorial duties faithfully and ably throughout his two-year term, he remained, by his own definition, a businessperson who was primarily committed to the transcontinental railroad enterprise that became his life’s work. He may have worn two hats, but railroading was his overarching passion.

Stanford’s association with the Central Pacific Railroad can be traced to his Whig political roots and his longtime interest in internal improvements. It took Theodore Dehone Judah, however, a Connecticut-born engineer, to help transform Stanford’s dreams into tangible realities. Judah had already built New York’s Niagara Gorge Railroad, and by the late 1850’s he had devoted his life to the building of a transcontinental railroad. When San Francisco investors turned him down, he was given an enthusiastic reception by Sacramento businesspeople, including Stanford. In addition to Stanford, Judah recruited three other principal investors: Charles Crocker, Mark Hopkins, and Collis Huntington. Each of the associates was a prosperous Sacramento merchant, all were about the same age, all but Huntington were native New Yorkers, and all had been active in the California Republican Party. In June, 1861, these four (soon known as the Big Four) became the railroad’s directors, with Stanford the president.

The Big Four’s first priority was electing Stanford governor. As Judah advised, “A good deal depends upon the election of Stanford, for the prestige of electing a Republican ticket will go a great way toward getting what we want.” With Stanford as governor, it became easier to attract potential investors and to secure favorable action from the state legislature. According to Huntington, the company’s vice president, “President Stanford promoted, the California legislature passed, and Governor Stanford signed seven acts of benevolence toward the Central Pacific”—one of which was a $500,000 subsidy, which was passed in the wake of some personal lobbying on the floor of the legislature by the governor.

Stanford was equally successful in his dealings with Washington. Regarding California gold as central to the financial health of the nation in the midst of the Civil War, Congress and President Lincoln probably needed little persuasion in aiding Stanford’s transcontinental railroad. On July 1, 1862, only six months after he had become governor, a federal bill to float loans to the Central Pacific became law. The terms provided both outright land grants and mortgage bonds in the form of long-term loans.

Stanford’s venture began on a shoestring. On paper, the Central Pacific Railroad was capitalized at $8,500,000, with each share selling at one hundred dollars. The reality, however, was far different. Only fifteen hundred shares were actually sold, and the associates purchased 40 percent of the stock for a mere 10 percent down. Stanford, then, began his meteoric rise to fortune, fame, and philanthropy with a fifteen-hundred-dollar investment.

Finally, in October, 1863, the Central Pacific began to lay its first tracks, and Stanford had already resolved not to seek reelection but to devote his entire energy to the building of the railroad. His most important contribution during this period involved the creation of a separate “dummy” company, the so-called Contract and Finance Company, which, in turn, “sold” its construction services and its equipment back to itself under the name of the Central Pacific Railroad. This financial sleight-of-hand allowed the associates to juggle the books successfully and to transfer funds from one account to the other, as well as to hide their own personal profits. As the sole owners of the “Contract and Finance Company,” the Big Four reaped huge profits that far exceeded comparable investments by the other investors, who could only purchase stock in the railroad.

Stanford, however, frequently found time to travel into the field and to rough it with the workers. He proposed that snowsheds be constructed in the Sierra to protect the tracks and the work crews. By 1869, thirty-nine miles of sheds had been built at a cost of two million dollars, a vivid demonstration of the massive undertaking that Stanford was leading. Finally, with a reliable and sufficient source of funding secured and a steady supply of materials guaranteed, Stanford’s Central Pacific Railroad cut through and over the Sierra Nevada, raced through the high desert of the state of Nevada, and joined the Union Pacific Railroad at Promontory Point (near Ogden), Utah, on May 10, 1869. With Stanford (the only member of the Big Four present) to drive (and to miss) the ceremonial golden spike, the nation’s first transcontinental railroad had been completed.

This was not the end for Stanford and his associates, but rather the beginning of a comprehensive and near-monopolistic railroad system in California and the Southwest. In 1867, Stanford engineered the buyout of the Western Pacific, a prospective competitor. This was soon followed by a successful raid on the Southern Pacific Railway, which had received a charter to run from San Francisco south to San Diego and on to New Orleans. Before the Southern Pacific could begin to operate as an independent entity, however, Stanford and the Central Pacific acquired control of it, probably sometime between March and September, 1868. By 1884, twenty separate lines had been consolidated and reorganized into the Southern Pacific Corporation. Stanford and the associates had knitted together a system that managed five thousand miles of track and controlled 85 percent of California’s railroads.

Presiding over the empire, however, did take an increasing toll on Stanford. In May, 1880, near Hanford, eight men were killed in the Battle Mussel Slough in the course of eviction proceedings. Despite public opinion to the contrary, Stanford took the hard line and helped to precipitate the bloody confrontation. Ever more defensive in the next few years, Stanford lashed out against the reformers who called for railroad regulation and adamantly refused to answer questions that touched on bribery and influence-peddling posed by the state’s railroad commissioners, whom he abhorred. Moreover, the Southern Pacific was incorporated in the state of Kentucky to protect the company from the ever-increasing hostility of California juries.

The financial complexities of the Central Pacific-Southern Pacific combine have always been shrouded in mystery. Nobody who knew of the inside workings would ever talk; nobody on the outside could ever get in. From an initial investment of fifteen hundred dollars in cash, each of the associates earned thirteen million dollars from the Central Pacific alone. When he died in 1893, Stanford, who had already given away money lavishly, was still worth at least thirty million dollars and was one of the richest men in the United States.

With such an immense fortune, Stanford did not stint on the good life. His sumptuously decorated fifty-room mansion atop San Francisco’s Nob Hill, with its precious wood paneling, was palatial. As befit a man of means, Stanford was able to live the life of a country squire. He purchased nearly eight thousand acres of land south of San Francisco that he called the Palo Alto Farm. He raised championship trotters there and became an international expert on their breeding and training. His farm was universally considered the best of its kind in the world.

Stanford’s interest in horses also led to the world’s first motion-picture experiments at the Palo Alto estate. In the hope of discovering whether a trotter had all four feet off the ground at some point during its gait, Stanford hired the noted English photographerEadweard Muybridge and planned much of the experiment himself. Stanford was a pioneer in the California vinoculture, and his Vina Winery, set amid an immense fifty-five-thousand-acre spread, was the largest and most modern in the world. For all the money and attention he lavished on this endeavor, however, the results were little better than mediocre.

By the 1880’s, travel became a way of life with the Stanfords, who frequently took the grand tours of Europe. On one such excursion, their only (indeed, almost revered) child, Leland, Jr., died of typhoid fever in March, 1884, in Florence, Italy. Grief-stricken, the Stanfords resolved to build a university in memory of their son on their Palo Alto property. Active from the beginning in every phase of the establishment of the university, from architecture to curriculum, Stanford was a solicitous and affectionate overseer of the enterprise. Stanford University , one of the few private coeducational universities, was opened on October 1, 1891, and in some ways, Stanford considered it his most significant achievement.

Although still active in planning the university and continuing as president of the Southern Pacific system, Stanford unexpectedly entered politics when the Republican-dominated California legislature elected him to the U.S. Senate in January, 1885. He served a relatively undistinguished eight years in that body and was a conservative spokesman for an unregulated economy. On occasion, however, Stanford demonstrated that he could transcend the limitations of his Darwinistic philosophy. He introduced a radical federal loan program for debt-ridden farmers and supported an innovative national funding proposal for education. In the last decade of his life, Stanford was, by far, the most popular of the Big Four. He died at his Palo Alto home on the evening of June 20, 1893.

Significance

Stanford was quintessentially an American “type.” Born of pure Yankee stock, he joined the Western migration to the frontier and rose to become a millionaire and the richest man in the Senate. He did not possess an extraordinarily brilliant or analytical mind, like an Andrew Carnegie, for example, but he did possess a wealth of diligence and patience, and an unerring eye for the main chance. He was productively restless and was adroit enough to seize opportunities that were wide open in California. In its early days, the state broke far more men than it made, and it is a tribute to Stanford that he survived the test.

Stanford was not wholly of the Central Pacific-Southern Pacific system, but he was the paramount leader of the Big Four. Of all the associates, he was the one best able to work with all segments of the population. He was the glue that kept this hard-driving clique together. His single-mindedness during his two-year gubernatorial term probably saved the endeavor. At the same time, and for the same reason, this unswerving commitment to his transcontinental railroad interrupted his political career. As governor, Stanford did exercise undue influence on the California legislature, and throughout the years, his railroad system did exercise an octopus-like grip on the entire state.

At a time when a transcontinental system was a national imperative, beyond the means of any individual or private group, Stanford helped to discover how to harness the financial resources of government. In the process, he did, indeed, become wealthy, but the public gained, too. Certainly, San Francisco became and remained the hub of the West, because it was at the center of Stanford’s transportation network. For all of its rapaciousness, the system did offer reliable service. This enriched California agriculture, the state’s source of wealth after the gold rush had played out.

Stanford was not quite a robber baron. His workers were loyal and were well paid. He was a collector of things (houses, horses, jewels, art), but he did not flaunt them. He was a man of great wealth but also a man of philanthropy. He was, finally, a new kind of American capitalist, who, in the absence of regulatory legislation and income tax, tested the outer limits of private enterprise. Stanford both lived in and helped define an age. Rules had not been made to temper the acquisitive men of his generation. His life was proof that he made the most of all of his opportunities; his life was also proof that more legislation was needed to hold men of business more accountable to the general public.

Bibliography

Ambrose, Stephen E. Nothing Like It in the World: The Men Who Built the Transcontinental Railroad, 1863-1869. New York: Simon & Schuster, 2000. This history of the transcontinental railroad offers a great deal of information about the role of Stanford and his associates in building the Central Pacific Railroad.

Bancroft, Hubert Howe. History of the Life of Leland Stanford: A Character Study. Oakland, Calif.: Biobooks, 1952. Published posthumously, this work is valuable because it was written by the dean of Western historians, who knew Stanford personally. Valuable primary sources, especially on the founding of Stanford University.

Bean, Walton E. California: An Interpretive History. 2d ed. New York: McGraw-Hill, 1973. A magnificent study of California that skillfully combines narrative and interpretation. Provides the context in which to place Stanford.

Brown, Dee. Hear the Lonesome Whistle Blow: Railroads in the West. New York: Holt, Rinehart and Winston, 1977. Good analysis of the effects the transcontinentals had on Native Americans and on the ecology of the West. Very strong on how the various systems helped to transform life and society in the West.

Clark, George T. Leland Stanford: War Governor of California, Railroad Builder and Founder of Stanford University. Stanford, Calif.: Stanford University Press, 1931. Written by the director emeritus of the Stanford library, the work is an adulatory biography. Very strong on the founding of the university.

Griswold, Wesley S. A Work of Giants: Building the First Transcontinental Railroad. New York: McGraw-Hill, 1962. A gripping popular account, especially strong on the engineering marvels; also helpful in comparing the Union Pacific with the Central Pacific. Also strong on describing the personalities of both systems.

Lewis, Oscar. The Big Four: The Story of Huntington, Stanford, Hopkins, and Crocker. New York: Alfred A. Knopf, 1938. Written with verve, this is a generally critical account of Stanford and associates; contains excellent character sketches of each of the partners and Theodore Judah.

Norris, Frank. The Octopus: A Story of California. New York: Doubleday, Page, 1901. Reprint. Edited by Kenneth S. Lynn. Boston: Houghton Mifflin, 1958. The first of a projected trilogy on the growing, selling, and use of wheat, this novel is an account of the struggle between the wheat growers of California and Stanford’s Southern Pacific.

Tutorow, Norman E. The Governor: The Life and Legacy of Leland Stanford, a California Colossus. With the special research and editorial assistance of Evelyn “Evie” LaNora Tutorow. 2 vols. Spokane, Wash.: Arthur H. Clark, 2004.

‗‗‗‗‗‗‗. Leland Stanford: Man of Many Careers. Menlo Park, Calif.: Pacific Coast, 1971. Tutorow initially wrote a relatively brief, and definitive, biography of Stanford; more than thirty years later, he published a more extensive and detailed two-volume biography. Both books are impressive in their research, offering indispensable accounts for any extensive consideration of Leland Stanford.