The name Cornelius "Commodore" Vanderbilt doesn't mean much to most people any more. The surname Vanderbilt rings a bell, but Cornelius himself is secreted somewhere deep in the miasma of American historical memory.
Was he the founder of that snooty private university in Nashville? The builder of a huge mansion cum estate near Asheville? Did he perhaps have something to do with the restoration of Grand Central Station in New York? Or with the Gloria Vanderbilt brand of jeans? He wasn't the other lead singer, along with Lionel Richie, in the Commodores, was he? See what I mean?
No doubt about it: Today the identity of this man is clearly Final Jeopardy! territory. In many ways, this is surprising, even shocking, because Vanderbilt -- "the first tycoon," as T.J. Stiles refers to him in his definitive biography -- was one of this country's greatest entrepreneurs, the progenitor of our modern transportation system, and the wealthiest man in 19th-century America, if not in our entire history.
For such reasons and others, he is well worth remembering, even if he didn't actually found Vanderbilt University, didn't build the Biltmore House or restore the present building at Grand Central Station, never marketed designer jeans, much less sing the lead in "Brick House" or "Three Times a Lady."
Given his modest background and meager education, the fact that Cornelius Vanderbilt rose to the heights he did is little short of astounding, at least at first glance. Born into a Dutch farming family on Staten Island, N.Y., in 1794, Cornelius received little formal schooling, while pitching in on the farm and involving himself in his family's side business, ferrying produce across the bay from Staten Island to New York City. Cornelius was soon cutting deals with other boatmen, ferrying produce around the harbor on his own account, and extending and expanding transport and trade links on the waterways, highways, and byways of the greater New York City area.
Geographical factors and matters of historical timing largely mitigated the initial disadvantages stemming from Vanderbilt's relatively humble background. New York was the most dynamic city in the United States in the early 19th century, offering an ambitious, energetic, and entrepreneurial young man -- even one of modest means such as Vanderbilt -- a propitious operational base. Moreover, Robert Fulton and others were in the process of successfully commercializing an innovation that would ultimately revolutionize water transportation: the adaptation of the steam engine to power boats on lakes and rivers, and later, ships on the open seas.
Vanderbilt, possessed with one of the central attributes often associated with entrepreneurship -- the ability to perceive and act on opportunities before they pass -- was quick to sense the possibilities offered by steam. By 1817, Cornelius, at the age of 23, got into the steamboat business himself. He agreed to captain the boat and oversee business operations for another successful ferry entrepreneur in the New York area, Thomas Gibbons.
This was the beginning of a historic business relationship, one fraught with importance for the American economy. At the time, more than 40 years after the publication of Adam Smith's "The Wealth of Nations," the American economy was still characterized by monopolies, insider deals, and special privileges that placed formidable limits on market size/access and significant constraints on market freedom.
Nowhere were such impediments more apparent than in the nation's transport sector, including that of New York, which had granted a steamboat monopoly to a company controlled by members of the Empire State's old aristocracy. Gibbons fought this monopoly assiduously in the courts; ultimately, in 1824 the Supreme Court struck down the New York steamboat monopoly in the famous case of Gibbons v. Ogden, ruling that states had no right to interfere with interstate commerce. With this decision the Marshall court did more than anything else to usher in the era of laissez-faire capitalism and free markets in the United States.
And Cornelius Vanderbilt did more than virtually anyone else to take advantage of this new economic freedom. In the decades after Gibbons v. Ogden, Vanderbilt -- working independently, with family members, and with outside partners -- became the country's most important transportation entrepreneur, extending his swath from steamboats to transoceanic steam ships to railroads.
By at once broadening and tightening markets, the transport improvements Vanderbilt pioneered and oversaw rendered the economy more efficient not just in the United States but in much of the Atlantic world, fostering greater individual and regional specialization, and allowing comparative advantage and comparative cost opportunities to come into greater play. Such was the magnitude of Vanderbilt's contributions , that he became almost unfathomably wealthy as a result.
To say that "the Commodore"-- a nickname he picked up in the late 1840s -- was, on balance, a force for great good in our economy is not to imply that he was particularly honest or ethical, much less admirable in personable terms. As Stiles makes clear in "The First Tycoon," Vanderbilt was a hard man, the sharpness of whose elbows more than matched the keenness of his mind. By 19th-century standards he was not particularly predisposed to shady business practices, but if need be, he was not averse to subterfuge, bribery, or financial or physical intimidation.
For Cornelius Vanderbilt, as for many great entrepreneurs in our nation's history, business trumped everything else. Stiles, author of an excellent 2002 biography of Jesse James, brings the Commodore, warts and all, to life in this new study, which is at once up-to-date in scholarly terms, analytically incisive, and lucidly written, if a bit excessive at times in quotidian detail.