Advent of Ben Holladay

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In the meantime work of grading from East Portland to Pudding River was energetically prosecuted, the heavy grading, and certain spots denied right of way being ommitted for the time. The representations of Elliott as to a contract with A. J. Cook and Company, were found to be no longer serviceable. Dr. A. M. Loryea, of East Portland, a bluff; gnarled oak sort of a man, naturally opposite to fine work, then Vice President of the company on his side the river, was allowed to go east on a fruitless search for the contractors, finding them neither east nor west, and in no way a connection of Jay Cook & Co., as they had become to be considered by the public. The blind had, however, allowed time for the completion, of arrangements with Ben Holladay, of California, (if not at first prepared by him in order to keep the name and machinery of the east side company in the hands of Oregonians until the land grant should be declared theirs, or to keep up so hot a fight against the West Side as to kill it, or to compel it to sell its franchises at a nominal price to its rivals); and in 1868, Holladay’s money began to flow into the exchequer and to energize the work of construction.

As Holladay came here as a railroad king, and, for about ten years carried all public matters with a high hand, becoming autocrat of all lines of transportation and well nigh political dictator and trans-forming the visage of the country not only, but inaugurating a new. system of politics and of public proceeding generally, it will be in place here to indicate something of his aims, methods, and previous history. He was one of the marked men of the age, of keen fore-sight, and an ambition and self-confidence that hesitated not to seize every opportunity of self-promotion. He belonged to the second order of potentates who have sprung up in America. Our system of government holds public servants to so rigid an account, and the public press so scrutinizes their actions, that it is not the office holder-who wields the power. He is hampered by constitutional restrictions, and public espionage, and by party pledges so that his work even in the legislative hall or the executive chair, becomes little more than perfunctory, or that of a factor. But behind his sphere, clothed with unlimited power, which laws have been unable to specify or courts to define, is the money king. It is popularly believed that his power is actually unlimited, except by his own mistakes, by the opposition of rivals, or by the integrity of influential men who will not be bought. But these restrictions upon his autocracy-like that of assassination as to the limit of the Czar’s absolutism-he of course refuses to recognize.

At the close of the war great opportunities were offered by the financial situation for immense speculations. That great conflict, in which men were organized and massed by the hundreds of thousands, and money was moved by the millions, had taught the country how to operate on a large scale. A spirit of daring and recklessness was also fostered. Those accustomed to risk their lives, or to see platoons of men hurled to death before long rows of cannons and bayonets, felt no hesitancy in risking so tame a thing as money, by the million dollars. A new confidence in the nation sprung up, and, as a sort of reaction from the moral strain, an intense eagerness for material advancement took possession. Money, as a power to control human action, was valued as never before, and, as is usual with new endeavors, was invested with a potency far beyond its real limit. Men of ambition, instead of following in the steps of Clay or Webster, and aiming to mould events by argument and eloquence, figured themselves as at the fountain head of the stream of gold, and by its flowing creating and transforming. It was towards railroading that the most brilliant conceptions were turned, and the West was to be the theatre of the vastest schemes. A patriotic and humanitarian feeling was mingled with these ambitious ideas, since the loyal part of the nation saw the advantage of bringing out of the wilderness States loyal to the government which had just emerged from an almost fatal struggle with secession, and setting the nation upon a granite foundation. Furthermore, the idea of renovating and populating the earth, as in old migrations, but by new improved methods of civilization, became once more fascinating to men of reflection.

Holladay was a Kentuckian by birth, had grown up in the West, had learned every foot of country between St. Louis and San Francisco upon his pony express, had breathed the California spirit of gold and adventure, and imbibed the western idea of the immensity of the future of the Pacific shores. Not exactly a disciple of Bishop Berkeley, he had, nevertheless, a practical notion that the star of empire was about nearing its zenith over the Golden Gate, and was as quick as anyone to see the opportunities for dominion as the national government was once more restored. He had had practical opportunity to see the workings of a railroad era in the Central and Union Pacific, and as by these roads his mail contracts were suspended, he very naturally turned elsewhere for a field. He had kept careful watch of the great line that had been projected into Oregon, and, keeping fully up with the operations of the companies managing it, he bided his time to seize their work when the best chance came. As an American, he was not devoid of ideality. He had in mind the development of a new empire. The pyrotechnic editorial flashes in all the papers about the seat of population being soon transferred to the strip of country between the Rockies and the Pacific were more or less present to his mind. He thought out some scheme of colonization. He was, nevertheless, a man whose selfishness dominated all else, and his practical incentive was to use the power of wealth to control a State, and perhaps a much larger area, in his own name. He showed no love for Oregon, or for the people of Oregon, but no other field was so inviting, or so well within his means.

From his subsequent actions, it may well be doubted whether his purposes were absolutely clear to himself, or that he followed them unswervingly. If his aim was simply to build a railroad; he might have done it with less trouble and expense, and for far greater returns. If his idea was to make himself the autocrat of the State, to own legislatures and United States senators, and perhaps to extend his operations over adjoining Territories and control transcontinental lines, he never followed it with consistency. Upon rigid examination we apprehend that he would be found a man of strong intentions, but of unstable will, of deep schemes, but of feeble convictions, of large aims, but incapable of sustained endeavor or sacrifice, and subject to passion and prejudice. It may also be said that, although in the strength of manhood when he came to our State, an excessive luxury of life and diet broke his vigor long before he reached old age.

As a working scheme of morality, he let nothing stand in way of his aims, recognizing no right except the shortest way to his object. He had one, And but one, means of attaining his end and that was the use of his money. To buy an attorney, a judge, a city, a legislature, public opinion, was all one to him. He made no appeals to the people, neither addressing them on the side of self interest or generosity. Upon occasion he published a message something after the style of a manifesto or edict. The public new nothing of him except that he was a nabob living in unapproachable magnificence, and was at the head of all that was going. He paid his agents and let them work their way, allowing them to use profanity or religion to reach the object that he named. This was the man that appeared in his true form above the stormy rail road horizon of Oregon in 1868. J. H. Mitchell, one of the first incorporators of the original Oregon Central Railroad Company, but also an incorporator of the second, or East Side Co., and their attorney, rendered very efficient service to Mr. Holladay.

Two general objects were now before this company; one to keep suits in court as long as possible in order to prevent decision upon the mooted points-since while the cases were in court the two companies seemed to, and did, stand upon the same legal ground, and neither one nor the other had the right to assume that it was the true and only company; and, in the meantime, to get an act through the Oregon Legislature, designating their company as the one to receive the grant of the United States land. They also expected to push legislation through Congress.

Upon the assembling of the Legislature at Salem in 1868, a bill was brought to thus designate this company and invest it with authority to receive the land. This was an audacious move, since in the session of 1866, two years before, the old Oregon Central railroad had been designated, and the company of which Joseph Gaston was president had been duly recognized, and had received from the acting Secretary of the Interior a certificate that its assent to the conditions of the land grant had been officially filed; while the assent of the East Side company-which was now seeking the bill-sent on later was returned without filing for the double reason that the time had expired, and that the other company had fulfilled the condition. But the bill was, nevertheless, introduced, and upon the minority report that there was no Oregon Central Railroad Company of any kind in existence on October 10, 1866, when the designating bill was passed by the Oregon Legislature, and that such bill was, therefore, mistaken and illegal, and the Secretary of the Interior at Washington City had been misinformed; and also that the West Side road had no more than $40,000 capital, and that $2,500,000 stock was held by the president of the company alone. The measure was passed. This was done in opposition to the majority report that in their opinion the. previous Legislature had designated a company, had declared it to be in existence, and that its articles had been provisionally filed on October 6th, four days before the original designating bill was passed. To parry the force of this last statement it was contended in the minority report that the company whose articles had been filed October 6th, in pencil, did not appear to be the same as that of November 21st following-which was the genuine West Side Company-since the names of incorporators were changed or appeared with certain additions.

Soon after this J. H. Mitchell went with these resolutions of 1868, favoring the east side company, to Washington City to secure favorable legislation from the United States Congress, taking the dispute to a national arena. He brought to notice of our senators, Corbett and Williams, the state of affairs, and the latter, learning the understanding of the matter by the secretary of the interior, O. H. Browning, to be that there had not been, as yet, a legal company to receive the grant of land-the west side company having failed to incorporate in time, and the east side company having failed to file assent in time-and that therefore without an a& to revive the grant the land must lapse, or had lapsed to the government; introduced a bill to allow a year’s time from date of passage for any company to file assent. This was opposed by the west side company, who were present at Washington by their president, and by S. G. Reed, as agent, on the ground that it virtually took the decision out of the courts, where it was still pending, and by putting the two companies on the same footing gave the east side a legal hold which it then did not and could not have-since under the former act it was impossible for it to file its assent in accordance with the provision, the time having long since passed by. The west side also complained that, as they had taken all the first steps to comply with the conditions of the act forming a company, spending money, and securing an extension of time of building, while the east side was for months doing nothing, and never got around to file an assent in time to hold the grant, they ought not to be put back on a par with a dilatory corporation, which since its formation had been maliciously opposing, hindering and trying to extinguish the only company that had had the address and expedition to save the grant to the State. In Senator Corbett they had a spokesman-Senator Williams also disavowing any hostility to. them, and being anxious only to save the land-and the general spirit of the Senate was in their favor; Conkling, Hendricks and Howard speaking pointedly that the equities of the case seemed to be with the west side company, and regarding the proposed bill as prejudicial to them. It was consequently recommitted; but at the next session was brought up, and after some adverse discussion by Corbett was passed. With this legislation the east side company virtually gained its point. Under the bill it became inevitable that the company which was able to complete the first twenty miles of the road within the time specified-by December 25th, 1869-would secure the land, which was the true prize and object of controversy. Both companies pushed forward with work of construction, but both met with delays. S. G. Elliott, on the east side, was found to be either incompetent, or, as asserted by his company, wilfully dilatory. On the west side the contractors, S. G. Reed & Co., who had been the main stay, became disaffected, and in April threw up their contra&, leaving the road hopelessly in the lurch; and, as asserted by west side men, furnishing the necessary locomotives and iron for the completion of the rival road. Gaston applied what money was left, and carried the grading to Hillsboro. Elliott was superseded by Kidder, under order of Holladay, and by forced work the twenty miles from East Portland to Parrott Creek was completed December 24th, 1869, just in time. This consummation was appropriately celebrated.

Seeing the impossibility of his company finishing their twenty miles within the time, Mr. Gaston applied all available money, carrying the grading to Hillsboro, and went to Washington in January of 1870, to secure if possible a separate grant of land for his company. In this he was successful, the grant being on the line from Portland to Astoria, and also to McMinnville. In the same year the old controversy as to which of the two was the rightful owner of the name O. C. Railroad Company, was decided in favor of the West Side, Judge Deady holding that this was the rightful corporation, and the other be stopped from using its designation. The East Side company having gained its government land cared no further for the name, and in March formally dissolved the Oregon Central Co., of Salem, transferring all their franchises and interests to the Oregon and Californian Railroad Company organized but a short time before, of which Holladay became president. By this act the West Side was left to the undisputed use of the name, but this was now a barren possession. Under his new land grant Gaston made arrangements with a Philadelphia Company to build the road, but owing to the dissatisfaction of Portland capitalists upon whom he hitherto relied, he decided to sell his road-the board of directors concurring-to Holladay. This was done in the summer of 1870. The Californian thereby became the master of the entire railroad situation in Oregon. Upon the subscription of $100,000.00 by the people of Portland, he began building the road, and in 1872 finished forty-eight miles to the Yamhill River at St. Joe.

It is instructive to notice that when the East Side road had gained its end, and found it necessary to dispose of S. G. Elliott, its attorney declared its early acts as to the issuance of unassessable stock illegal; and “A. J. Cook & Co.” was then admitted, or asserted to be a myth, or at least but some obscure individual whose name was irresponsibly and fraudulently used by Elliott-thus confirming the charges of their old enemy and rival.



MLA Source Citation:

Harvey Whitefield Scott. History of Portland, Oregon: with Illustrations and Biographical Sketches of Prominent Citizens and Pioneers. Portland, Oregon. D. Mason & Company, 1890. AccessGenealogy.com. Web. 31 October 2014. http://www.accessgenealogy.com/oregon/advent-of-ben-holladay.htm - Last updated on Apr 12th, 2013


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