Washington and the Networks of WW Corcoran
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Washington and the Networks of W. W. Corcoran Mark L. Goldstein Leveraging critical networks throughout his many professional and political endeavors, W. W. Corcoran played a significant role in both the transformation of America’s financial markets and the growth of the nation’s capital. Corcoran made important contributions to the social, cultural, and physical development of an increasingly sophisticated capital city and was one of the nation’s most important philanthropists almost a generation before the wealthy Gilded Age. In this paper I further the notion that networks played an integral part in capital formation and business development—beyond bridging the world of partnerships and Chandlerian hierarchies—and could achieve individual and organizational objectives. I also suggest that network characteristics were more enduring and multifaceted than previously recognized, as they transcended business activities to achieve other mutual goals. Furthermore, the consolidation of a self- conscious and influential American moneyed class earlier than generally acknowledged broadly influenced politics, culture, and the urban-built environment in places other than New York, including the seat of American government. If William Wilson Corcoran is remembered at all in modern America, it is for the art gallery that he built shortly after the Civil War in Washington, D.C., across from the White House. Less known are Corcoran’s significant roles in the transformation of America’s financial and banking community and in the funding of the government’s needs for the Mexican-American War during the 1840s. Corcoran made important contributions to the social, cultural, and physical development of an increasingly sophisticated capital city. He was one of the nation’s most important philanthropists almost a generation before wealthy Gilded Age patrons established and strengthened America’s cultural institutions in the late nineteenth century. As a life-long resident of Washington whose family was involved in the earliest days of the capital city’s creation, Corcoran had well-established attachments to the city and close Mark L. Goldstein <[email protected]> is a graduate student at the University of Maryland at College Park. © Business History Conference, 2007. All rights reserved. URL: http://www.thebhc.org/publications/BEHonline/2007/goldstein.pdf. Mark L. Goldstein // Washington and the Networks ofof W.W. W.W. CorcoranCorcoran 22 connections to its power base that allowed him to become one of America’s first lobbyists and peddlers of political influence.1 Corcoran managed these remarkable (if little-remembered) achievements by developing and sustaining a network of those influential in finance, arts, and politics in Washington, New York, Philadelphia, and Baltimore, and, ultimately, throughout the United States and Europe. He influenced and frequently befriended almost every U.S. president from Andrew Jackson to Rutherford B. Hayes. Corcoran also counted as friends such disparate men as Edward Everett, Daniel Webster, Robert E. Lee, and John Slidell; built connections with most of Washington’s mayors; and had close business and social relationships with financiers and bankers ranging from George Peabody and Junius Morgan to Elisha and George Riggs. What is more, in art and architecture circles, Corcoran interacted routinely with the likes of Albert Bierstadt, William Walters, James Renwick, and Andrew Jackson Downing. Indeed, many of the individuals in Corcoran’s influential networks were helpful to him not only in politics or business, but throughout his many endeavors, assuming critical roles in a variety of activities that, absent the power and personality of Corcoran, would in all likelihood have remained unconnected. Recent scholarship on the development of business networks and the growth and consolidation of urban monied elites reveals the value of continuing study of these important issues. The salience of positing a new synthesis in business history incorporating multiple approaches toward the structure and function of business and financial entities permits the illumination of vital networks that created capital formation and furthered the American economy.2 The emergence of new studies examining the social and cultural influences that consolidating elites played in urban environments further advances the understanding of the ramifications of class identity and how, supported by wealth and power, it transformed cities and influenced their development.3 In this essay, focusing on Washington, D.C., and the networks of W. W. Corcoran, I further the notion that networks played an integral part in capital formation and business development— beyond bridging the world of partnerships or one-shot transactions and Chandlerian hierarchies—and could achieve individual and organizational 1 Corcoran’s father, Thomas, was twice mayor of Georgetown, and Pierre L’Enfant, designer of Washington, was several times a visitor to Corcoran’s boyhood home. Additionally, Corcoran’s father was among the delegates who escorted George Washington on his tour of the area when the founding father was considering placement of the capital city; see William Wilson Corcoran, A Grandfather’s Legacy: Containing a Sketch of His Life . (Washington, D.C., 1879), 4. 2 Naomi R. Lamoreaux, Daniel M. G. Raff, and Peter Temin, “Beyond Markets and Hierarchies: Toward a New Synthesis of American Business History,” American Historical Review 108 (April 2003): 404-33. 3 Sven Beckert, The Monied Metropolis: New York City and the Consolidation of the American Bourgeoisie, 1850-1896 (New York, 1993), 2-3. Mark L. Goldstein // Washington and the Networks ofof W.W. W.W. CorcoranCorcoran 33 objectives. I also suggest that network characteristics may be more enduring and multifaceted than previously recognized, as the employment of such networks transcended business activities to achieve other mutual goals. Furthermore, the consolidation of a self-conscious and influential American moneyed class appears to have formed earlier than generally acknowledged and seems to have broadly influenced politics, culture, and the urban built environment in places other than New York, including the seat of American government. Business Connections Corcoran’s success in early American banking and securities endeavors occurred literally on the foundations of the Second Bank of the United States, whose offices diagonally across from the White House Corcoran assumed in establishing his financial activities. After the Second Bank lost its charter in 1836, Corcoran opened a brokerage firm in 1837, and in 1840 he formed a banking firm, Corcoran & Riggs. The firm did not issue bank notes as was common during the period, but instead concentrated on investing in U.S. Treasury notes and reselling them to investors.4 Through extensive contacts in Congress and multiple presidential administrations, Corcoran successfully attained (and retained) significant government deposits on the demise of the Second Bank and, with his networks’ influence, kept Treasury funds after they were pulled from other banks. Based on Corcoran’s connections, the bank became one of the premier conduits between Washington and Wall Street. Through his networks, Corcoran built and benefited from strong relationships with several Treasury secretaries, including Levi Woodbury, who often revealed to Corcoran the nature of his competitors’ bids on Treasury notes, and Robert Walker, who made Corcoran the U.S. agent for the Treasury during the administration of James K. Polk.5 Corcoran’s networking acumen made him rich, and it was critical to one of his most important successes, the selling of nearly $22 million in U.S. government bonds to finance the Mexican-American War in large part through London and Paris brokerage houses usually suspicious of American paper.6 Corcoran 4 Corcoran started the bank on his own but soon brought into the firm George Riggs, Jr., son of Elisha Riggs, one of the nation’s wealthiest merchants and a significant Wall Street player. It was generally from Elisha Riggs that Corcoran learned his Wall Street–Washington connections, although his investments on Riggs’ behalf were not always successful; see generally Letterbooks of Elisha Riggs, PNC Bank, Washington, DC. 5 Corcoran’s connections to Walker continued for many years; they were frequently associated in investment dealings related to railroads, land speculation, and mining. Ironically, Walker would become the U.S. agent in England during the Civil War, sent to prevent that country from aiding the Confederacy at the same time Corcoran was in London and rumored to be seeking such support. 6 See generally Roland Carr, 32 President’s Square: Part I of a Two-Part Narrative of the Riggs Bank and Its Founders (Washington, D.C., 1980), 84-90; and Henry Mark L. Goldstein // Washington and the Networks ofof W.W. W.W. CorcoranCorcoran 44 & Riggs was heavily involved in many loans sold domestically and it was not uncommon for Corcoran to accompany Walker to Wall Street to sell the government’s offerings to the financial community. Still, it was Corcoran’s sale of significant securities in Europe when domestic purchases were flagging late in the war that most impressed the financial community.7 Indeed, Corcoran’s approach was so risky that his banking partner, George Riggs, felt the firm was too exposed and left the bank; he was replaced by his son, Elisha Riggs, Jr. Nevertheless, so important were Corcoran’s efforts that his contemporaries saw them as a