GOULD, JAY

(1836-1892), railroad financier. Christened Jason, Jay Gould was born on a farm near Roxbury, New York. He taught himself the rudiments of surveying, and by the age of twenty-one, the undersized, quick-witted youth had prepared several county maps, written a local history, and saved five thousand dollars. Between 1856 and 1860 Gould operated a tannery but gave it up to join a Wall Street brokerage house. Following the panic of 1857 he had made modest and profitable investments in several short railroads.

In 1867 Daniel Drew, treasurer and longtime director of the Erie Railroad, added Gould and James Fisk to the Erie board of directors. When Cornelius Vanderbilt, of the New York Central, sought to buy control of the Erie a spectacular battle ensued. Gould, Fisk, and Drew promptly issued thousands of shares of new, watered stock. When the angry Vanderbilt obtained an arrest warrant for the three, they ferried company headquarters to Jersey City, and Gould rushed to Albany where a pliable New York legislature authorized the stock issue. Eventually peace was made with Vanderbilt, but that gentleman was reported to have muttered that his trouble with the Erie "has learned me it never pays to kick a skunk." Later in the fall of 1869 Gould and Fisk conspired with the brother-in-law of President Ulysses S. Grant to corner the gold market, causing the panic of "Black Friday," September 24, 1869. Gould continued to loot the Erie until his departure in 1872. His role in the Erie War and the attempted gold corner gave him a reputation as the prime financial predator of the age.

Possessing a fortune, Gould turned to western railroads. In the twenty years after 1872 he was a director of seventeen major lines and the president of five. He purchased much Union Pacific stock and controlled that road until 1878. At first Gould improved the management of the Union Pacific but later blackmailed the company by threatening to have the Gould-controlled Kansas Pacific build a nuisance line to Utah. During the 1880s Gould controlled about half the mileage southwest of St. Louis and Kansas City and tried unsuccessfully to expand his western holdings into a transcontinental rail empire to the Atlantic Coast. He also owned the New York World for a time and held major investments in New York City's elevated railways and several large telegraph companies, including Western Union. In his last years Gould suffered from tuberculosis and died of that disease at the age of fifty-seven, leaving a fortune of $77 million to his six children.

Gould was a man of many faults and virtues. He was cold and unscrupulous but courteous and unassuming, and in his private life, devoted to his family, flowers, and books. He could not be trusted but nonetheless helped build more efficient regional rail systems. He was a wrecker of values but a railway leader who helped achieve major rate reductions. Gould remains the prototype robber baron of the late nineteenth century, although his defects probably have been exaggerated because he was never comfortable with the press.

Robert L. Frey, ed., Railroads in the Nineteenth Century (1988); Maury Klein, The Life and Legend of Jay Gould (1988).

John F. Stover

See also Railroads; Robber Barons.