The Gould Standard

Renehan points out that Gould was no worse than contemporaries such as Cornelius Vanderbilt and John D. Rockefeller. He maintains that Gould got bad press, not only in his own time, but also subsequently, from “three generations of biographers.” One scandalmonger advanced a partner’s suicide by two years to make it seem that Gould had been the cause of the deranged man’s death.

Perhaps, Renehan suggests, this is because Gould, unlike the Rockefellers and Vanderbilts, left no large charitable bequests. Instead, he chose to give anonymously during his lifetime, after the press mocked his good works as feeble attempts to atone for his financial sins. Gould also kept silence about his personal life, never trying to garner sympathy with his rags-to-riches backstory. “The fact of my father’s poverty is not worth one dime to me,” he told a persistent reporter. Clearly, only dimes, and not his personal reputation, had value for the man. But it is hard not to admire one who had so little talent– or patience– for “spin.” Later he would say that he minded bad press only because “it came back on” his family.

Interestingly enough, many details of Gould’s early life (he was born in 1836) come from Gould’s testimony before Senate hearings on the relations between capital and labor in the 41st Congress (1869-1870).

From the beginning, Renehan shows that Gould was focused, hard-working, and sober, believing, he told a friend, that “happiness consisted not so much in indulgence as in self-denial.” He avoided alcohol, tobacco, swearing, and gambling (except on Wall Street). His mother died when he was not quite five, a sister succumbed to tuberculosis, and Jay himself nearly died of pneumonia as a young man. A feeling that time was short drove him on, as did a frantic desire to escape his father’s hardscrabble farm.

Horatio Alger could hardly have topped the picturesque story of Gould’s first job as a surveyor, making “noon marks”– a line through a farmer’s window that would be struck by the noontime sun, enabling him to set a clock. By the age of 21, Gould had come to realize that brokers “take what seems the smallest share” of an enterprise, “but is in fact the largest,” since it was pure profit. He had found his niche.

Renehan admits that Gould could be an “unpredictable Wall Street pirate,” but insists that, unlike the “sinister” Daniel Drew– aka the Great Bear because of his brilliant and disastrous stock manipulations– Gould used speculation on Wall Street “to take control of companies he could manage, improve and merge.” In the 1880s, railroad companies offered the greatest potential for expansion.

Gould’s first major undertaking was the so-called Erie War, a complicated tussle over railroad stock in which Gould and his partner, Jim Fisk, took on Vanderbilt and caught Drew in a “bear trap.” Their titanic battle nearly eclipsed local press coverage of the impeachment trial of Andrew Johnson, and gave the pair of upstarts the “odd negative celebrity” of scoundrels who out-scoundreled the dastardly Drew. In the process, they unwittingly enriched many small investors.

Gould’s next big enterprise was an attempt to corner the gold market. Renehan admits that Gould hoped to make a “speculative killing,” but argues that Gould was also trying to build up the Erie’s freight-hauling business by raising the price of commodities. Gould tried some underhanded influence on President Ulysses S. Grant and, on September 24, 1869, “Black Friday,” bankrupted nearly a thousand individual investors. That he lost heavily himself did not prevent him from earning an “irretrievably tarnished reputation” from this escapade.

Renehan notes that Gould’s legend as the “Mephistopheles of Wall Street” would besmirch his genuine subsequent achievements: taking control of the Union Pacific and building up a network of railways throughout the Southwest, garnering “hard-won profits” for shareholders. Gould displayed not only a genius for details but also an almost puckish sense of humor when he engaged in a rate war with Vanderbilt. When Vanderbilt dropped the per-carload rate for cattle to a “ridiculous” one dollar, Gould and Fisk bought up all the livestock coming into Buffalo and shipped it on Vanderbilt’s line, realizing enormous profits.

In politics, Gould avowed that “in a Republican district I was a strong Republican, in a Democratic district I was a Democrat . . . in politics I was an Erie Railroad man every time.” When General Custer died at Little Big Horn, Gould observed that its result would be to “annihilate the Indians & open up the Big Horn & Black Hills to development,” greatly benefiting his concerns.

Renehan supposes a reader with some knowledge of business transactions. But he leavens the sometimes arcane financial shenanigans that involve bulls and bears, shorting stocks and watering stocks, with sketches of the entire pirate band– including Drew, Vanderbilt, the gaudy Jim Fisk, even Fisk’s mistress, Josie Mansfield.

Renehan mentions time and again Gould’s small stature, barely five feet, and physical frailty. Given Gould’s enormous capacity for work, this seems somewhat irrelevant. More to the point is Renehan’s account of Gould’s behavior when Fisk, his friend and partner, was shot by a rival in love: Gould bowed his head upon his hands and wept “unrestrainedly with deep, audible sobs.” Hardly the action of a monster.

Dark Genius offers a finely nuanced portrait of Gould, the eighth richest man in American history (adjusting for inflation, Gould outranks Bill Gates, J.P. Morgan, and Sam Walton) and delves into both his gaudy financial history and his quiet personal life. It also recalls to mind a poem about Captain Kidd in A Book of Americans (1933) by Rosemary and Stephen Vincent Benét: All the “newer history books,” they wrote, “say [Kidd] never pirated / Beneath the Skull-and-Bones. / He merely traveled for his health / And spoke in soothing tones.“

Dark Genius goes to considerable lengths to show that Gould was a tender family man who wore simple suits and pottered in his garden, was loyal to his friends and generous to his personal staff. Gould often invited young employees to use his library; those who did were further helped with scholarships. He actually cultivated his negative image, quoting Machiavelli’s advice from The Prince that it was better to be feared than to be loved. And he was always good for colorful copy, as when the New York World noted on one parlous occasion that Gould “seemed to contemplate the coming conflagration as serenely as if he had a complete monopoly of the trade in Lucifer matches and petroleum.”

Kristie Miller is the author, most recently, of Isabella Greenway: An Enterprising Woman.