Q.David Bowers
The B&O Railroad
While the Cumberland Road linked Baltimore with the West in the early nineteenth century, it was soon realized that canal transportation was cheaper than overland shipping. In the face of competition from the Erie Canal to the north (begun in 1817, opened for traffic in 1826), and a canal which was started in Pennsylvania in 1826, Baltimore's future seemed uncertain. To remedy this, Baltimore citizens determined to build America's first commercial railroad. In 1827 a charter was obtained for the Baltimore & Ohio Railroad. In January 1830 business commenced. By 1834 the tracks stretched to Harper's Ferry, and by 1842 to Cumber-land. It was decided to extend the trackage to the Ohio River at Wheeling, Virginia, in 1846. Around that time the Garretts, who owned just 11 shares of stock, became interested in the line. Financing was needed. The 200-mile stretch between Cumberland and Wheeling crossed the Appalachian Mountains and involved an estimated cost of $6 million. Credit of the Baltimore & Ohio Railroad was poor. In 1849 its shares sold for just 28c on the dollar. Railroads to the north, formed later than the B&O, had reached certain western areas first and were taking much of the traffic.
The Garrett family stepped in and helped the B&O Railroad in several ways. Bonds were sold to finance the extension to Wheeling, and the firm assisted with various management situations. Henry Garrett joined the board of directors in 1852 but remained only for a year or so. John W. Garrett joined the board several years later. In 1858, at the age of 38, he was elected president of the railroad.
In the meantime, John had married Rachel Ann Harrison, the daughter of Thomas Harrison, a Baltimore merchant. In the summer John W. Garrett and his family lived on an estate, Lansdown, located to the southwest of Baltimore. During the rest of the year they lived nearer in the family's three-story mansion in the central city. John W. Garrett had four children: Robert, T. Harrison, Henry S., and Mary Elizabeth. Henry was an invalid all of his life. John's father, Robert Garrett, died on February 4, 1857, at the age of 74.
During the late 1850s the Baltimore & Ohio Railroad occupied much of John W. Garrett's time. Henry Garrett managed the day-to-day activities of Robert Garrett & Sons. The latter business grew even more. The company gained prominence in the field of stocks, bonds, and other securities. The old commodity business was discontinued for the most part, with business being done only on a limited basis to serve old accounts.
During the Civil War many problems occurred in domestic and international finance. Money was scarce in circulation, customers delayed payments, and other crises arose. Losses were often sustained by those who held United States currency and Treasury notes, for they were not readily accepted in the channels of commerce, due to the uncertain outcome of the Civil War. During one low point the Garretts wrote to another finance firm stating that "we may be led to discontinue entirely." Attempts were made to lease the Eutaw House and the Howard House.
Like many Baltimorean families, the Garrett family was divided in loyalty during the war. Henry favored the policies of the South, while John supported the North. The Baltimore & Ohio Railroad was a Northern railroad, despite the fact that its tracks were below the Mason-Dixon Line. As a result, many problems arose. At one time the governor of Virginia threatened to confiscate much of the railroad if Garrett allowed federal troops to use it. A letter, signed by 100 Southern sympathizers, threatened to destroy every bridge and the track of the railroad if Northern soldiers were carried on the route. Involved in the threat were some of Garrett's closest friends, for the letter stated "many of our committee know you personally, some intimately."
Despite the danger, the Baltimore & Ohio Railroad was kept busy as the only rail link between Washington and the Northern states. It operated more or less continuously, with occasional interruption and much interference by the Confederate forces. In October 1862 John W. Garrett put a train at the disposal of President Abraham Lincoln, who journeyed to Antietam, inviting Garrett to join him. On October 3, 1862, Mathew Brady photographed Lincoln, George B. McClellan and John W. Garrett in front of Gen. McClellan's tent.
In January 1865 Abraham Lincoln personally penned a letter to John W. Garrett:
It is said we shall soon all be in the dark here, unless you can bring coal to make gas. I suppose you would do this, without any interference, if you could; and I only right now can say, it is very important to us; and not to say that you must stop supplying the army to make room to carry coal. Do all you can for us in both matters.
Yours truly,
A. Lincoln
Lincoln paid a high tribute to the Baltimore & Ohio Railroad for the services rendered and declared that John W. Garrett was "the right arm of the Federal Government in the aid he rendered to the authorities in preventing the Confederates from seizing Washington, and securing its retention as the capital of the loyal states."
Henry Garrett's sympathy for the Confederate cause resulted in numerous problems, including his arrest in 1861 for disloyalty. The charges were subsequently dropped. Apparently the difference in political orientation between Henry and John did not cause friction between the two. Henry suffered from illness throughout much of his adult life. On October 10, 1867, he died.
John W. Garrett's two sons began learning the family businesses in the summer of 1867. Robert Garrett, 20 years of age, graduated from Princeton College in June of that year. He chose the railroad business as his career. Soon he became president of the Valley Railroad following the term of Gen. Robert E. Lee, who had acquired the position following the Civil War. In July 1875 Robert Garrett went to work for the B&O. In 1879 he became third vice president, and in 1881 he became first vice president and a director. When his father John W. Garrett went to Europe in May 1883, he became president pro tern in his absence. He remained in that position during his father's illness. Following the death of John W. Garrett, Robert became president of the line. During his term a new branch was built to Philadelphia at a cost of $10 million. Additional properties were acquired. In the summer of 1887 he went to Europe to secure financing to retire earlier Baltimore & Ohio Railroad debts. When he returned to the United States in October he discovered that the B&O Telegraph Co., which had been one of his favorite enterprises, had been sold to a competitor, Western Union, for $5 million in stock, against his wishes. This news, plus declining health, caused his resignation. He continued on the board of directors for several years but did not take an active part in planning.