John Pierpont Morgan:
The turn of the century in American, when E.L. Doctorow’s novel Ragtime is set, was a time marked by rapid technological developments and industrialization. These years also brought a heavy flood of immigrants as well as an increasingly urban American landscape. Technological advancements enabled increased efficiency and mass production. However, Doctorow clearly brings into question the consequences of this new technology for the average American worker. J.P. Morgan’s discussion with Henry Ford about the assembly line’s innovations brings this debate to the front. Doctorow writes, “From these principles Ford established the final proposition of the theory of industrial manufacture – not only that the parts of the finished product be interchangeable, but that the men who build the products be themselves interchangeable parts” (113). Here Doctorow clearly addresses the potential for technology to undermine the value of the individual and his abilities.
Banker and industrialist John Pierpont Morgan was one of the world’s foremost financial figures in the decades before World War I. He organized railroads and formed the United States Steel Corporation. His wealth and financial management skills were so considerable that he was able to steer the United States Treasury from the brink of disaster.
Morgan was born in Hartford, Connecticut, in 1837, and educated at the University of Gottingen in Germany. In 1871, with members of the Drexel family of Philadelphia, he organized the New York banking firm of Drexel, Morgan & Company. It began lending vast sums to railroad builders and industrial corporations in the 1880s and was later reorganized as J.P. Morgan and Company.
As noted by Erin Arvedlund, he was a “natural born financier and loved spreading his bank account among dozens of different foreign currencies.” John Pierpont Morgan and his father established a firm that was later to be known as J.P. Morgan & Co. Throughout Ragtime, E.L. Doctorow constantly refers to the economic status of the families and immigrants. J.P. Morgan’s companies and firms were large employers of these immigrants. His achievements in finance and business greatly affected the families in this novel. Money was something that could break a family apart if it was nonexistent.
In 1857, John Pierpont Morgan’s father, Junius Morgan, decided to broaden his son’s experience by sending him to New York. The firm of Duncan, Sherman ; Co. was the American representation of the George Peabody Company. Junius Morgan wrote to the company asking for a position for his son and advertising the fact that his son had many admirable qualities for a worker. Although, J.P. Morgan was denied a promotion when his father requested one, he did receive a promotion in the firm later in his career. In 1860, Morgan left Duncan, Sherman and founded J. P. Morgan and Company to act as an agent for his father’s business. When Junius Morgan died in 1890, J.P. became head of the London house. Pierpont now was able to control all the dealing between the New York based firm and their oversees partner.
Pierpont was now at the head of houses in New York, Philadelphia, London, and Paris. He was the commanding figure in international finance. In 1869, a war over railroads began, including Jay Gould and Jim Fisk, both famous financiers. Gould already had dominant control over the Erie railroad and began to buy up stock in the Albany & Susquehanna Railroad. Morgan developed into the nation’s railroad reorganizer. In 1886, the Philadelphia and Reading Railroad was in great difficulty with a deficit of six million dollars a year. Morgan was brought in to slash the value of the watered stock, reduce interest rates on the bonds, and assess the shareholders for more money. 1888, J.P. Morgan was again called on to reorganize railroads in the east. He reorganized the Chesapeake ; Ohio and the Baltimore ; Ohio. He often encountered some resistance to his interference but managed, in the end, to accomplish his set goals and reshape the failing economic Railroad system.
Morgan’s reputation most likely grows from his role in the emergence of many modern companies. Morgan, through his innate business sense, helped launch some of America’s largest corporations. He was able to invest and help foundling companies in need of his monetary support and guidance. Morgan went on to help create the Federal Steel Company, the National Tube Company, and the American Bridge Company.
The first time that Morgan was truly introduced to the general public was his aid to the government in 1895. At the time many people believed that Morgan as well as other wealthy financiers including Carnegie and Rockefeller were stronger than the government and were not subject to ordinary laws. The national Treasury had been successively issuing bonds to maintain the depleting gold reserves. However, their actions were hurt by the ironic withdrawals of gold, by the Treasury itself, with which to make purchases. President Cleveland and his administration were forced to appeal to international bankers. Morgan formed an alliance between himself and several other financiers including August Belmont to furnish the government with $56 million in gold, most of which was obtained abroad.
The public often questioned the large undisclosed sum of money Morgan made by supporting the Treasury in 1895. This event was only one of many debatable issues that concerned Morgan and his control over the government and the American market. President Roosevelt investigated Morgan’s large deal with the U.S. Steel Corporation and Tennessee Railroad Company but found that that the means employed were none the less effective, as well as profitable. The value of Morgan’s organization of companies and funding is immeasurable, as these companies are some of today’s leading corporations. His assistance to the government in time of need, although profitable for himself, was a necessary act and was vital at the time for the continuance of a strong economy. Pierpont built America with more in mind than that of personal financial gain. His inspiring industrial genius shadowed whatever greedy impulses he acted on. A critic of Morgan said after his death, “Never again will conditions of government make it possible for any financier to bestride the country like a Colossushaving greater force, greater character, greater intellect and greater vitality than any other man on Wall Street, he naturally became the leader and remained the leaderin time little will remain except the feeling however much ability and strength and genius that man possessed” (Lindstrom). John Pierpont Morgan is considered one of the founding fathers of the modern United States economy.
Despite conflicting opinion on his persona, his influence and character shaped the business world more so than any other person at the turn of the century. Morgan was “a banker, railroad czar, industrialist, financier, philanthropist, yachtsman, and ladies’ man” (Jones). He was an industrial genius that is accredited with the founding of many companies including General Electric and AT&T. However, Morgan is looked upon as “a saint and demon the same” (Arvedlund). He received a honorary degree from Harvard university that read: Public citizen, patron of literature and art, prince among merchants, who by his skill, wisdom and courage, has twice in times of stress repelled a national danger of financial panic.
Arvedlund, Erin. Unmasking J.P. Morgan. 2000. 9 Apr. 2003
Doctorow, E.L. Ragtime. New York: Plume, 2003.
“John Pierpont Morgan.” Microsoft Encarta Encyclopedia 2001 Standard. 2003.
Jones, Lisa L. A Collector’s Portait: John Pierpont Morgan (1837-1913). 2003. 9 Apr. 2003
Lindstrom, Diane. John Pierpont Morgan. 2003. 9 Apr. 2003