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Jay Gould

1911 Encyclopedia Britannica

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JAY GOULD (1836-1892), American financier, was born in Roxbury, Delaware county, New York, on the 27th of May 1836. He was brought up on his father's farm, studied at Hobart Academy, and though he left school in his sixteenth year, devoted himself assiduously thereafter to private study, chiefly of mathematics and surveying, at the same time keeping books for a blacksmith for his board. For a short time he worked for his father in the hardware business; in1852-1856he worked as a surveyor in preparing maps of Ulster, Albany and Delaware counties in New York, of Lake and Geauga counties in Ohio, and of Oakland county in Michigan, and of a projected railway line between Newburgh and Syracuse, N.Y. An ardent anti-renter in his boyhood and youth, he wrote A History of Delaware County and the Border Wars of New York, containing a Sketch of the Early Settlements in the County, and A History of the Late Anti-Rent Difficulties in Delaware (Roxbury, 1856). He then engaged in the lumber and tanning business in western New York, and in banking at Stroudsburg, Pennsylvania. In 1863 he married Miss Helen Day Miller, and through her father, Daniel S. Miller, he was appointed manager of the Rensselaer & Saratoga railway, which he bought up when it was in a very bad condition, and skilfully reorganized; in the same way he bought and reorganized the Rutland & Washington railway, from which he ultimately realized a large profit. In 1859 he removed to New York City, where he became a broker in railway stocks, and in 1868 he was elected president of the Erie railway, of which by shrewd strategy he and James Fisk, Jr.(q.v.), had gained control in July of that year. The management of the road under his control, and especially the sale of $5,000,000 of fraudulent stock in 1868-1870, led to litigation begun by English bondholders, and Gould was forced out of the company in March 1872 and compelled to restore securities valued at about $7,500, 0 00. It was during his control of the Erie that he and Fisk entered into a league with the Tweed Ring, they admitted Tweed to the directorate of the Erie, and Tweed in turn arranged favourable legislation for them at Albany. With Tweed, Gould was cartooned by Nast in 1869. In October 1871 Gould was the chief bondsman of Tweed when the latter was held in $1,000,000 bail. With Fisk in August 1869 he began to buy gold in a daring attempt to "corner" the market, his hope being that, with the advance in price of gold, wheat would advance to such a price that western farmers would sell, and there would be a consequent great movement of breadstuffs from West to East, which would result in increased freight business for the Erie road. His speculations in gold, during which he attempted through President Grant's brother-in-law, A. H. Corbin, to influence the president and his secretary General Horace Porter, culminated in the panic of "Black Friday," on the 24th of September 1869, when the price of gold fell from 162 to 135.

Gould gained control of the Union Pacific, from which in 1883 he withdrew after realizing a large profit. Buying up the stock of the Missouri Pacific he built up, by means of consolidations, reorganizations, and the construction of branch lines, the "Gould System" of railways in the south-western states. In 1880 he was in virtual control of Io,000 miles of railway, about one-ninth of the railway mileage of the United States at that time. Besides, he obtained a controlling interest in the Western Union Telegraph Company, and after 1881 in the elevated railways in New York City, and was intimately connected with many of the largest railway financial operations in the United States for the twenty years following 1868. He died of consumption and of mental strain on the 2nd of December 1892, his fortune at that time being estimated at $72,000,000; all of this he left to his own family.

His eldest son, George Jay Gould (b. 1864), was prominent also as an owner and manager of railways, and became president of the Little Rock & Fort Smith railway (1888), the St Louis, Iron Mountain & Southern railway (1893), the International & Great Northern railway (1893), the Missouri Pacific railway (1893), the Texas & Pacific railway (1893), and the Manhattan Railway Company (1892); he was also vice-president and director of the Western Union Telegraph Company. It was under his control that the Wabash system became transcontinental and secured an Atlantic port at Baltimore; and it was he who brought about a friendly alliance between the Gould and the Rockefeller interests.

The eldest daughter, Helen Miller Gould (b. 1868), became widely known as a philanthropist, and particularly for her generous gifts to American army hospitals in the war with Spain in 1898 and for her many contributions to New York University, to which she gave $250,000 for a library in 1895 and $100,000 for a Hall of Fame in 1900.