BE CAREFUL WHAT YOU WISH FOR

I think the basic problem with democracy is that humans are too darn clever for it to ever work efficently. Consider the lesser genius of old John Q. Adams (above), son of a founding father, who, after one term in the White House, won a seat in the House of Repesentatives, which he occupied for another 17 years as “Old Man Eloquent”.  Congressman Adams first dragged slavery onto the House floor for open debate, and then engineered the first compromise which delayed the Civil War for forty years -  a pretty clever guy. But it was also J.Q. Adams who was clever enough to insist he should not be counted as “present” if he refused to respond when his vote was called for. It was a matter of principle to John Q, and a matter of temprament. He was just too old to stand up and walk out of the chamber every time someone asked him to vote on something he wanted to avoid voting on. How could he predict that two generations later, in the hands of hack politicians, this principle would be used to thwart democracy?

They called it a “Silent Quorum”. By October of 1893, when the Senate was trying to repeal price supports for silver, which were costing taxpayers millions of dollars every year, this procedure had become a monster whenever the majority was razor thin. Without a quorum present, (half the membership plus one) no vote was legal, so by remaining silent when their names were called, the minority could “fillibuster” any action they wanted to avoid losing on. It was a manuever which one particular House member described as a “...peculiar art of metaphysics which admits of corporeal presence and parliamentary absence”. That year, over two days, the U.S. Senate tried 39 times to remove price supports for silver removed. And every time the quorum evaporated. A decade later the obstructionists had so honed their craft that this same particular House member calculated that the House of Representatives spent “...a whole month...calling over our own names”. Usually the bills being  fillerbusted were either dropped, or the delay and deal making required to get them passed held the Congress up to public ridicule. Who ever heard of such a thing?

The 'particular' Congressman who finally broke the filibuster of silence was a fourteen year veteran who knew the lower house of Congress well enough to describe it as “A gelatinous existence, the scorn of all vertebrate animals”. He owned the biggest head in politics (in more ways than one) and the sharpest wit in the Washington, at the time. Fifty year old Thomas Brackett Reed (above) was, said a critic, as “ambitious as Lucifer”.  He was also a giant - 6'3” tall and 300 pounds – who inspired one who saw him strolling to say in awe, “How narrow he makes the sidewalk look.” Republican Thomas Reed once lamented in his measured Maine drawl, “We live in a world of sin and sorrow. Otherwise there would be no Democratic Party.”  When accused of mockery by a Democrat, Reed responded, ““I will say to the gentleman that if I ever ‘made light’ of his remarks, it is no more than he ever made of them himself.”   Reed described two politicans who annoyed him, this way; “They never open their mouths without subtracting from the sum of human knowledge.” He was imperious and dictitorial even with friends - a small “d” democratic Robespierre.

Like all political revolutions, newly-elected Speaker Reed's, was inspired by necessity. Specifically, on 23 January 1890, he received the Committee on Elections report concerning the 4^th district of West Virginia. The Democratic Governor had thrown out the results from two polling places and declared Democrat James Jackson the winner. The loser, Republican Charles Smith, had appealed to congress. The Congressional Committee's Republican majority had labeled the governor's actions so outrageous that it “seems like a farce to argue about it” and recommended giving the seat to Smith. As expected the Democrats wanted to argue about it. Technically Reed had three more than the 166 Republicans needed to push through Smith's election. But if three or more of his own party were out sick or away from the floor Reed's working majority would fall to the “tyranny of the minority”. Thomas Reed was determined to do something about that.

Before the session was to begin that noon, on Wednesday, 29 January, 1890, Speaker Reed called the two ranking Republican members of the election committee into the hallway behind the Speakers podium, known as the Speakers' Lobby. There Reed warned Joe Cannon from Illinois (above) and William McKinley from Ohio that even with two Republicans dragged from their sick beds, what with several still out sick, one dead and another home with a dying wife, the Democrats could be expected to use a 'Silent Quorum' to delay or even kill action on their report. But Reed had a plan. What he did not tell this allies was that he had recently secured a partnership in a private law firm, in case his plot blew up in his face and he was forced to resign from the Congress. Representative Cannon asked when the Speaker intended upon launching his plan. Reed responded simply, “Now”, and he strode into the chamber.

After the preliminaries for the opening of a session, Edward McPherson, the House clerk, called for a vote on the report of the election committee. The initial results were 162 yeas, 3 nays and 163 not voting. The Democrats immediately called for a “quorum call”. Again Mr. McPherson read out the roll call, pausing after each of the 332 names for a response. All 162 Republicans in the chamber answered “present”. Not a single Democrat in the room lifted his voice. The “Silent Quorum” had again triumphed - or so it seemed. But then Speaker Reed announced ponderously, “The Chair directs the Clerk to record the names of the following members as present and refusing to vote.” And slowly he began to read off the names he had marked down as being in the room.

According to the Associated Press reporter who was present, “Pandemonium broke loose...wild excitement, burning indignation, scathing denunciation...” When Reed called his name, the Democratic war horse William Breckinridge bellowed over the mob, “I deny the power of the Speaker and denounce it as revolutionary!” By now Democrats were spilling into the aisle and pressing toward the podium, “...as if they intended to mob the Speaker.” But imperious, “utterly fearless”, and (said the New York Times) as “cool and determined as a highwayman,” Speaker Reed deigned not to acknowledge their outrage. He just kept reading the the names of the no longer silent minority.

When he called out, “Mr. McCreary”, the sexagenarian ex-Governor of Kentucky and ex-Confederate Colonel, James Bennett McCreary (above), shouted up at the podium, “I deny your right, Mr. Speaker, to count me as present!” Unexpectedly, Thomas Reed paused, and the entire bedlam paused as well, sucking in a breath of anticipation. Gazing down impassivily from atop the massive podium, the New England Buddha pronounced, “The Chair is making a statement of fact that the gentleman is present. Does he deny it?” Representive McCreay was nonplussed. And calmly Reed continued with his roll call of the principled “absent”. And when he had finished, over the din and angry shouts which again tore the air, he announced he would now give his reasons for the revolution he had just launched.

The Constitution, in Article One, section five, said Reed, dictates that each house of Congress could “...compel the attendance of absent members, in such manner, and under such penalties as each house may provide.”  Speaker Reed argued, “If members can be present and refuse to (be)....counted as a quorum, that provision would seem to be entirely negated. Inasmuch as the Constitution only provides for their attendance, that attendance is enough. If more was needed the Constitution would have provided for more.” His words were not going to sway the losing side, but then that was not whom Reed was speaking to.  “Are elections a farce and is government by the people a juggle?” he asked. “Do we marshal our tens of millions at the polls for sport? If there be anything in popular government it means that whenever the people have elected one party to take control of the.House or the Senate, that party shall have both the power and the responsibility. If that is not the effect, what is the use of the election?”

Having said his peace, Mr. Reed intoned, “The Chair thereupon rules that there is a quorum present within the meaning of the Constitution.” Breckinridge demanded to make a point of order. Reed dismissed him, saying. “The Chair overrules the point of order”, without even hearing it. “I appeal the decision of the Chair,” shouted the old war horse. Interjected the Republican Lewis Payson from Ilinois' 9^th district, “I move to lay the appeal on the table”. And with a Republican second, the Congress now debated the very idea of Reed's revolution.

It went on for three bitter, angry, frustrated days. And from atop the pyramid of the podium Thomas Reed sat impassive, “serene as a summer morning”, rendering Parlimentary decisions which kept the debate moving.  Speaker Reed used his gavel so often, he broke it (above).  Charles Landis, the Indiana Republican, insisted that Reed “...did not gag debate, he simply....thought that a man who had a private balloon to inflate should hire a field.”  If the Democrats “shouted until the acoustics bled,” wrote Landis, that was merely “prima facie evidence that they were in the vicinity”. In the beginning Republicans were not united, but the Democratic reaction had forced the doubters into the battle line. Even the one Texas Democrat who stayed seated while ominously wetting his bowie knife, helped to unite Reed's Republican troops.

Thomas Reed came out of this debate forever bearing the tag of “Czar Reed”. But he also won his point. On Monday, 3 February 1890, the Democrats admitted defeat and simply walked out of the chamber (above). This left the Republicans with just 165 votes - one short of a quorum. An hour later, Republican Joe Sweeny of Iowa, having raced from the train station, walked into the chamber and announced, “One more, Mr. Speaker”. And with that a quorum was achieved. And the reason for the drama (if anybody still remembered), Charles Smith, was officially elected to the 4^th district House seat for West Virginia, by 166 votes to 0. Twenty-six days later the United States Supreme Court rejected the Democratic appeal, and the matter was settled for at least a generation.

"Reed's Rules" gave the Republicans the power to fully enact their programs. And the public fully rejected them. In the election of 1890 Democrats gained the clear and working majority both sides had wanted, and immediately discarded Reed's Rules.  Reed's observation on this was, “The House has more sense than anyone in it.”  Two years later, the Republicans re-gained ground and it was the Democrats who were facing a intransigent minority, lead by Thomas Reed. The Democrats were forced to now accept and use Reed's Rules for themselves. In response, Thomas Reed said only, “I congratulate the Fifty-third Congress.” And he meant it.

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GETTING WHIPPED

I understand why Ben Halladay was legendary in 19^th century America. “The Stagecoach King” might have been “"illiterate, coarse, boastful, false, and cunning” and “not one to hesitate over the niceties of business ethics”, but he was also a self made man who amassed a fortune in transportation. According to legend, Ben Halladay's legendary business savvy was proven when he challenged several driver applicants to show how closely they could steer one of his coaches to the edge of a cliff. It was a dangerous evaluation, so risky that one applicant refused to even take the test. That was the driver Ben Halladay hired, or so the story went. But the test was a myth. It never happened. But the story does illustrate how difficult it can be to separate truth from legend - like the iconic driver in the myth, the legendary Charley Parkhurst.

The technology Halladay built his empire upon was the iconic Concord Coach (above),  famous in thousands of western movies but designed and built in eastern Connecticut. It was one of America's first hi-tech exports, and familiar from Missouri to Oregon, from Australia to South America and South Africa. A ticket for a Concord Coach provided, “...fifteen inches of seat, with a fat man on one side, a poor widow on the other, a baby in your lap, a bandbox over your head, and three or more persons immediately in front, leaning against your knees....”  The 3 inch wide leather cross braces, which supported the coach's body, were so effective at dampening road ruts and rocks into Mark Twain's rocking “cradle on wheels”, that many of the passengers suffered from motion sickness. But then the function of the cross braces was to benefit the horses and the coach, not the riders. Concord Coaches did not break down, so the saying went, they wore out.

They called stagecoach drivers “Whips”, although they were not expected to use that device very often. The best drivers, such as the hard drinking, tobacco chewing Charley Parkhurst, steered the 2,500 pound 12 foot long Concord Coach with the sensitive fingers of their left hand, via the “ribbons”, or leather leads to each pair of horses. With his right hand the driver constantly “feathered” the brake, to prevent the coach from crowding the horses. That left no hand free to snap the whip.

Charley Parkhurst (above) was an orphan out of Lebanon, New Hampshire, hired out as stable hand in Worcester, Massachusetts while just six or seven years old . Sleeping in the stables reinforced Charley's affection for horses. Seeing this, the stable owner, Ebeneezer Balch, taught Charley the delicate art of driving two-in-hand, four-in-hand, and even six-in-hand - six horses controlled by three “ribbons” entwined through gloved fingers. Over decades the 5 foot 6 inch Charley became so well known around Providence, Rhode Island as an adept and skilled driver that in 1849 when local businessmen Frank Stevens and James Birch decided to “Go West” to start a stage company, they paid the passage aboard a California Clipper ship for the 38 year old Charley. One of the other travelers, James Duchow, described Charley as “...a very queer fellow indeed”.

The California route favored by Charley Parkhurst was the nine hour 25 mile climb over the Summit Road, winding through the 3,000 foot high Santa Cruz mountains, between San Jose, at the southern edge of San Francisco bay, and Santa Cruz at the northern lip of Monterrey bay. The fare was $5 per passenger. “Six Horse” Charley Parkhurst drove that route for seven years for the California Stage Company, and became  known, as his coach rumbled past the isolated cabins along his route, to toss candy to the children. Then one day, unexpectedly, James Birch was drowned at sea and Frank Stevens gave up and sold out. But by then Charley was so well respected in California that every passenger line on the west coast sought out his skills.

The economics of frontier stagecoaches demanded that they have government subsidies - U.S. Post Office Contracts. The California Stage Company was paid $1,000 a year (the equivalent of $23,000 today), for delivering mail between Santa Cruz and San Jose, and similar subsidies kept communications open all the way from San Francisco to the gold fields in the Sierra Nevada foothills. Even with these subsidies, Charley's new employer, the Pacific Express Company, went bankrupt. They were succeeded by the Pioneer Stage Company, a subsidiary of the Butterfield Stage Lines, owned by Ben Halladay. And then in 1866, the Stagecoach King sold out to Wells Fargo, lock, stock and barrel, for $1.5 million ($22 million today).

There was no reason for the Stagecoach King and the reticent Charley Parkhurst to have ever met during the brief time that Charley worked for Ben Halladay, thus destroying the myth of the drivers' test. Besides, Charley was already paid well enough that he was able to invest in a “relay station” just north of Watsonville. He partnered in this with another driver, Frank Woodward. These stations were franchises, which allowed the company to remove from their balance books the riskiest and largest expense of operating a stagecoach line – the feeding and caring for the stock. But the cost to those who took on that risk was illustrated when Charley was kicked in the head while shoeing a horse. He lost the sight in his left eye, and became known thereafter as “One-eyed (or cock-eyed) Charley”.

It was not a surprise that Charley's and Frank's relay station, like most, failed after a year or so. So, after 56 years of an already hard life, Charley was forced to go back to driving. But he was no longer a young “whipper snapper”, and suffered from the bane of all those who make their living with their fingers. Charley was quoted in a Monterrey newspaper, explaining, "Pay's small and work's heavy. I'm getting old. Rheumatism in my bones -- nobody to look out for old used-up stage drivers.” But that would prove not to be so. By 1870 Charley had retired to a small house on Bean Creek outside of Watsonville, a property provided by the Harmon family. His only known close friend, of 20 years, Frank Woodward, often stopped by for a visit, and helped Charley in making deliveries for the neighbors.

“Cockeyed” Charley Parkhurst died at 75 years of age, on Thursday, December 18, 1879. The cause of death was cancer of the tongue, probably a by-product of all the tobacco Charley had chewed for forty-odd years while commanding a Concord Coach. Having come into this world an unwanted orphan, at his death Charley was surrounded by the Harmon family and Frank Woodward. Death must have been a release for the old Whip. His will left $600 to 12 year old George Harmon. But the old driver's story was not yet ended.

When the neighbor women came in out of respect to wash “One-Eyed” Charley's corpse, they discovered that Charley Parkhurst was a woman, born Mary Parkhurst in 1812. Her mother died giving her birth, and her grief stricken father had given the infant up to an orphanage. Was Charley/Charlie a lesbian? The modern assumption is that he/she was. But that may be a modern lens distorting past visions. When Frank Woodward was informed of the discovery, he cursed good and long. But history can never tell us why he cursed.

All we know for a fact is that from the moment Charley Parkhurst had left the orphanage, still a child, he had lived as a man, competed as a man, succeeded as a man. It was his preference, for whatever reason. And perhaps it is truer to Charley's memory to let the matter rest there, as the San Francisco Morning Call put it a week after the old man's passing. “"No doubt he was not like other men, “ wrote the newspaper, but “He was in his day one of the most dexterous and celebrated of the famous California drivers...and it was an honor to be striven for to occupy the spare end of the driver's seat when the fearless Charley Parkhurst held the reins of a four-or six-in hand.” Charley Parkhurst was fondly remembered by almost everyone who had ever known him.

Six years earlier, on September 18, 1873, the Wall Street financial firm of Jay Cooke and Company had unexpectedly declared bankruptcy, and within hours the American economy collapsed into what was called for decades “The Great Depression”. Like hundreds of thousands of others, The Stagecoach King Ben Hallady lost a fortune that day, maybe two. He had to sell three of his mansions, one on K Street in Washington, D.C., another along the Hudson River in upstate New York, and one in Portland, Oregon. That left him with just one. A year later he lost control of a railroad he was building in Oregon, and the bitter old rich man spent the last thirteen years of his life suing the other robber barons who had robbed him. He died on July 8, 1887, at just 68 years of age. He was fondly remembered by almost nobody.

The two lessons I draw from this tale is that, first, all the good do not die young, and second, that secrets only have power over the people who keep them - Oh, and also that the one thing legends are not, is reality.

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AIR HEADS - Part Four - Windy City

I believe it was with apprehension that Cal Rogers set his “Vin Fiz” flyer down on the Cicero airfield on the afternoon of October 8th, 1911, rather than with a sense of accomplishment. Cal was now officially 21 days out of New York City. He had flown just 1/3 of the distance to California. He had crashed, so far, six times, or about once every 166 miles. At this rate he had to assume he would crash another six times before he reached the foot of the Rockies at Denver, Colorado. And he would either be spending Christmas somewhere in Utah, or dead. The Pony Express was proving faster than the" Vin Fiz Flyer". Upon landing in Chicago,  Cal immediately telegraphed William Randolph Hearst to request an extension of the time limit for the $50,000 prize offered by the mogel's newspapers. But Cal could not have known that W.R., as Mr. Hearst liked to be called, had no intention of letting anybody actually win the prize money.

Like most self described “self made” millionaires (such as Donald Trump), William Randolph Hearst was the son of a millionaire. When W.R. was kicked out of Harvard, where the boy had struggled to survive on a $500 a month allowance (the equivalence of $11,000 a month, today), it seemed he was destined for failure – well, as much as the  pampered only son of a millionaire could fail - because the only thing bigger than the fortune which W.R. would eventually gain control of, was his ego.

In 1887 W.R. took over the “San Francisco Examiner”, which his father George Hearst  had won in a gambling debt. W.R. then sank part of daddies’ fortune into making it the “Monarch of the Dailies”. He hired the best writers and editors that daddies’ money could buy, (such as Mark Twain and later Harriet Quimby) and built a publishing edifice based on the formula of sex plus comic strips equals sales. The first of the Sunday comics printed in color was Hearst's “The Yellow Kid” (above). Thus the origin of the description of W.R.'s style of newspaper as “yellow journalism”. And what was yellow journalism? A. J. Pegler, a Hearst writer, described it this way: “A Hearst newspaper is like a screaming woman running down the street with her throat cut.” Think, Fox News with ink.

When daddy George Hearst, died in 1891, W.R. convinced his mother to sell off the mining properties on which the family fortune had been built. He used the cash influx to finance his acquisition of the “New York Morning Journal”, where W.R. repeated his "Examiner's" recipe of success - which he had learned, by the way, during a summer internship under Joseph Pulitzer. It makes journalism's"Pulitzer Prize" seem like a mea culpa, doesn't it?  And then W.R. began to buy newspapers, eventually 42 of them, with 30 million plus readers. Now he could syndicate his well paid writers and increase his advertising revenues, which he used to promote and publicize his runs for congress, and as governor and mayor of N.Y.C.  He failed to win any of those elections. But everything W.R. did was ultimately to promote and publicize W.R., including the Hearst Prize for the coast to coast air race.

W.R.’s interest in flying was typically mercenary. When his editors had approached him with the idea of offering a $50,000 prize for the first transcontinental flight, experts like Glenn Curtiss and Wilbur Wright, warned  that aviation was too young to achieve such a lofty goal.  In 1910 no plane could stay aloft longer than two hours at a time, and none could travel faster than fifty miles an hour. Airplanes were still made out of wood and wire, for crying out loud. But, on the plus side, offering the prize would fill W.R.'s newspapers day after day, with articles about how it could it be done, who could do it, who didn’t think it could be done, and how many would die trying to do it.

W.R. was awarded a medal from the Aeronautical Society of America for just offering the prize. And W.R. loved to get medals. But paying out the prize money would sell W.R.'s newspapers for one day only. And that was why the Hearst Prize had contained a time limit. It was set to expire on October 17, 1911, before Hearst figured anybody could make it. So, when Cal Rogers’ telegram arrived, begging for an extension, W.R. was in no rush to respond. Cal waited in Chicago for two days for the telegram from Hearst, and he began to suspect he had been had. So with just a week left before the deadline, he decided to force W.R's hand.  On October 10th he flew across the flatlands to Springfield, Illinois, then on to Marshall, Missouri. As he arrived in Marshall,  far away from any cities fed by Hearst newspapers, Cal found a telegram from Hearst waiting for him. There would be no extension in the time limit.  Cal had now flown 1,398 miles since leaving New York, which gave him the record for longest continuous flight. But there would be no pot of gold at the end of this rainbow, just a bottle of Vin Fiz - yuck.

A more mercenary element now influenced Cal’s romantic quest. When the city of St. Louis withdrew its offer of a thousand dollars for landing there, Cal simply bypassed the town, and its Hearst newspaper. Instead he flew on to Kansas City, landing in Swope Park.

Experience was forcing Cal to learn how to handle the money side of the race, as well as well as how to handle his plane. His decided to turn south, to avoid taking the Rocky Mountains head on,  and to also avoid Denver and its Hearst newspaper. There were far fewer trees to run into on the Great Plains, which reduced certain dramatic elements in Cal’s landings and take offs. He was also making better time. There were fewer crashes, fewer late night repairs; everbody on the crew was getting more sleep. And at about 9 A.M. on October 19, 1911 the “Vin Fiz Flyer” crossed the Red River into Texas.

And on that same day the race that was no longer a race, became a again.

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A LITTLE HELP

I apologize, but the closest I can come to describing the drama in the board room of the New York and Erie Railroad on that crisp November afternoon is to recall one of the concocted tribal councils on the “reality” television show “Survivor”. Now, because of the time compression, deleted conversations, subtle “background” music additions and the myriad of other minor manipulations that fall under the label of “editing”, the only common element between a modern day “Survivor” contestant and Mr. Jacob Little, the Antebellum "Napoleon of the Board Room", was that over the span of just a few moments they both stood to win or lose a great fortune. And that has not been a reality for corporate managers in America for so long as to make it hard for modern readers to imagine it was ever true. It ain’t a real game if you are “too big to fail” because then, you can’t lose. And Jacob could.

Jacob Little was called “the original Wall Street Bull”. That was not quite true. The ancient traders, who bought hides from butchers, invented the ‘futures market’, by buying and selling the hides of cattle that had not yet been born. And if farmers thought the prices for hides were approaching the bottom they might hold onto more of their bulls, thus ensuring more cows for next season, when the prices might be better. So, those who expected prices were going up, were expecting a “bull market”. A bull in the stock market is a gambler, aggressive and willing to use his horns to get his way. And that is an apt description of Jacob Little.

Jacob’s contemporary, Henry Clews, claimed that Jacob “…made and lost” nine fortunes on Wall Street. And Matthew Smith, in his book “Sunshine and Shadow in New York” recorded a moment of introspection which Jacob experienced while walking past the mansions surrounding Union Square. “I have lost money enough today to buy this whole square. Yes, and half the people in it,” he said. And that was probably not an exaggeration.

At a time when railroads were the high tech, Jacob Little, tall and slim and “careless in his attire, wearing a hat like that of a farmer, and not a very prosperous one”, was known as the ‘Railway King’. He had realized there was far more money to be made in manipulating railroad stock than in running railroads. Between 1830 and 1855, when the nation quadrupled its miles of railroad track, 125 railroad companies issued stock but never laid a single mile of track. They sold preferred stock and common stock, and several varieties of bonds. And then there was the "futures’ market" in railroad stocks and bonds. There was even an ‘options’ market, which was the buying and selling of promises to buy or sell stocks in companies that might not even exist. This was the Wall Street version of the Wild West; have printing press, will fleece all suckers. And even those railroads that were real, suffered from endless manipulation.

Consider the profitable Norwich and Worchester Railroad in Massachusetts, whose largest stockholders signed a secret agreement to sell their Norwich stock only to each other. This created an artificial shortage of the stock, which drove the price up. The partners agreed to hold their shares until Norwich topped $90 a share. They would then dump the stock and leave the suckers owning a suddenly broke and worthless railroad; As the lawyer Tom Hagan explains in “The Godfather”, “Its just business, Sonny.” Just to keep all the crooks honest, any member of the “cartel” who sold below $90 a share pledged to pay a $25,000 fine to his fellow conspirators.

Jacob Little was one of the largest conspirators in the Norwich stock scam, but he was the smart one. As the stock began to rise, Jacob quietly offered to sell his fellows a portion of his stock at $89 a share. Well, perhaps offer is the wrong word. Because after Jacob had done this several times it dawned on the crafty New Englanders that they had to buy his stock in order to avoid a price collapse of their stock. And once Jacob had unloaded all his Norwich stock at $89 a share, he dutifully mailed a $25,000 check to his “partners”. By then he had profited several times that amount by shafting his partners exactly as they had planned on shafting the suckers. The partners let it be known that if the Bull of Wall Street showed his face in Boston again, they intended on claiming his ears.

It was maneuvers such as that which inspired a handful of the lesser wizards of Wall Street to plot Jacob’s demise. They were his fellow board members on the New York and Erie Railroad, and it seemed to them that Jacob was overextended. You see, besides owning a large chunk of Erie stock, Jacob had recently bought several thousand ‘options’ pledging to buy even more. When those options matured in six months, if the option holders demanded it, Jacob would have to deliver the stock at whatever the price.

Jacob was betting, of course, that the price would go down, and as a board member he had the power to help that happen. But the wizards decided to use Jacob’s genius against him. First, they quietly bought up all of Jacob’s options. And then, as the six months ran out, they began to buy every share of Erie stock they could find, bidding the price up 15 points above the price of Jacob’s options. And Jacob remained so blissfully unaware of the doom that was impending, he actually bought even more options.

The ultimate “Survivor” moment arrived at the 2:00 p.m. meeting on Friday, November 16, 1855. It was the maturity date for Jacob’s options. Jacob was late arriving at the meeting, but even after he finally arrived, the meeting droned on tediously until the board room clock struck 3:00 p.m. The stock market was closed for trading. It was no longer possible for Jacob to buy stock to meet his options. And in the best tribal council fashion, one by one the wizards presented their options to their cornered prey. The stack piled up before Jacob got very impressive. The Napoleon of the Board Room had been broken and broken right before their eyes. But just as Jeff Probst was about to say, “The next person voted off “Survivor....”, Jacob Little pulled an immunity idol right out of his derrière.

Actually he pulled it out of London. Jacob was late to the board meeting because he had stopped in the Erie’s stock transfer room to convert Erie Railroad “convertible bonds”, bought weeks earlier on the London Stock Exchange, into Erie common stock. Such bonds are usually not worth the premium they sell for. If you are going to pay that much, you might as well buy the stock. But in this case the wizards had helpfully bid the price of Erie stock so high, they made the premium more than worth the price. And as Jacob fastidiously signed over each share required to fill the options, he was also diluting Erie Stock so that, when the market reopened in the morning, the stock price took a nose dive. The wizards had been so intent on cutting off the limb that Jacob had climbed out on, that they failed to notice they were out on the same limb. And Jacob had climbed down first.

Clearly somebody had leaked the plot, and, in retrospect that was inevitable. During his 12 years as an independent broker Jacob had built friendships and done favors for local bankers from San Francisco to New Orleans. Somebody was bound to warn Jacob about the brewing coup d’etat. But so brilliantly had Jacob gamed the system that generations of future Wall Street bulls used his trick to transfer future fortunes into their bank accounts at the expense of future generations of suckers, until the rules were eventually changed to require a convertible bond be held for at least sixty days before it could be transferred into common stock.

Most Wall Street fairy tails end the story here, with The Napoleon of the Board Room smiling a winning smile while the image fades to black. But in reality, inevitably,  Jacob lost one more fortune than he made. He died flat broke on Sunday, March 28th, 1865. The Board of the New York Stock Exchange adjourned for the day to attend his funeral, but I can not say for certain whether they did this out of respect, or to confirm that Jacob was finally really dead. But I can say it has been the goal of Wall Street bankers and gamers ever since to rig the game so that they never run the risk of dying broke, ever again. And that makes it a very different game than the one that Jacob played.

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