USA > California > Los Angeles County > Los Angeles > Men of achievement in the great Southwest Illustrated. A story of pioneer struggles during early days in Los Angeles and Southern California. With biographies, heretofore unpublished facts, anecdotes and incidents in the lives of the builders > Part 3
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The Santa Fe Railroad Company had been building in the Southwest for some years. The road had reached The Needles on the Colorado River, where it connected with the Mojave branch of the Southern Pacific. They had built to Guaymas in the State of Sonora, Mexico, and had a connection with the Southern Pacific at Nogales. One day the late C. P. Huntington, who had charge of the financial affairs of the Southern Pacific, found himself in need of a million dollars. He needed it at once, and he needed it very much. Money was not easy. He obtained what he wanted by selling the Mojave branch of the road to the Santa Fe, the Guaymas branch of the Santa Fé being turned over to the Southern Pacific. The Santa Fe proceeded to build from Barstow through Cajon Pass to Colton. Having made trackage arrangements with the Southern Pacific, access was had to Los Angeles. California oranges had begun to reach the markets of the East. At New Orleans in 1884 the California fruit had taken the first prizes. The newspapers had been for five or six years heralding the praises of the section to willing cars all over the country. The railroads made more and more favorable rates to the Coast. Personally-conducted excursion parties became frequent and were well patronized. The eastern railroads sent out regular agents to work in Los Angeles. A war of railroad rates brought fares lower and lower, until they reached $25, and for months people could come to the Coast for that much. The fare had been as high as $150; then $100. For a few hours on one day the rate for a trip across the continent fell to $1. Then a truce was made, but the rates remained very reasonable as compared with what they had been. In 1886 nearly all the railroads were running excursion trains at low rates, and the people poured in. The newcomers knew of the
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army behind them, and began to gather up "corner lots" and "choice residence sites" in all parts of the city. The pioneers, who never dreamed of what was coming, were willing sellers. The "tenderfeet" held for a rise, and made those who came a week later pay it.
So the "boom" began.
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PALM DRIVE, JOHN SINGLETON'S GROUNDS, LOS ANGELES.
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CHAPTER VI.
THE GREAT "BOOM."
The speculation in real property which prevailed in Southern California in 1886 and 1887, forcing values up at a rate never before experienced in so short a time, has been known ever since by the slang term, "The Boom." Abroad its history has never been correctly told, nor its reasons comprehended. From the time the Americans came to California, up to nearly 1880, agriculture was more or less neglected in all sections. Stock-raising and gold mining seemed the only pursuits worthy of any attention. In the drought of 1861 the small population of the State almost starved for bread, flour having to be brought from the East. On many a league-long ranch milk, butter, potatoes and vegetables of all kinds were unknown, excepting as they were brought in from the outside. Farmers raised hogs and drove them 250 miles to San Francisco, and at the same time used on their own tables hams and bacon cured in Chicago. When Isaac Friedlander began to grow wheat in the San Joaquin Valley for export, Californians regarded him as more or less lacking in common sense; but by 1880 wine grapes and deciduous fruits, such as peaches, plums and prunes, had become important crops in the counties around San Francisco Bay. Before this time, such pursuits received little attention in Southern California. The orange had come to be regarded as worthy attention. Both city and country properties were selling slowly at prices far below their intrinsic value. With the inflow of new people the point of view began to change. Grapes at $20 a ton were recognized as profitable to the grower. The "tenderfeet" of the three years, 1885 to 1887, inclusive, had seen cities in the Central States grow up like the fabled gourd of the Prophet Jonah. Town- sites were given to the Santa Fé Railroad Company when the railroad began to extend through the section. The managers sent out agents who had had experience in Kansas and other States booming realty. These men understood their business. With brass bands and barbecues the crowds of tourists who had nothing to do were drawn to mustard-covered mesas and brown hillsides, where, in glib accents, the promoter told how soon a flourishing city was sure to spring up as if by magic from the ground, or fall by a miracle from the skies. The new arrival from the East one day bought a lot and lay in wait for the tourist of the next day to unload on him at an advance. Real estate agents flocked in from San Francisco, from Chicago and from New York. They painted broad banners, hired bands, bought whole pages in newspapers, and in every way fished for "suckers" in all waters. All along the railroads plots for cities were laid out, until the whole countryside was covered with white lot-stakes. Scrap-iron street-car lines were laid down from the railway station through the prospective cities. Holes were dug on hillsides, which were supposed to be for reservoirs to furnish water. In many cases, large expenses were incurred in laying down sidewalks, grading streets and building costly hotels. Prices went up! and up! and up! All classes lost their heads. The room which had been evident for legitimate increase in values was exceeded, and no one seemed to realize that there was any limit to the prices that might be paid for property. This inflation was not so marked in the best property in the business centers, where reve- nues might be looked for. On the crest of Bunker Hill lots that had gone begging for buyers in 1882, at $300 each, were salable at $10,000. For three lots fronting on Bunker Hill avenue, Grand avenue and Second street an offer of $50,000 was refused. The holder lost it a few years later, under foreclosure proceedings, on a mort- gage to secure a note for $13,000. Unimproved at the present time, it would sell for perhaps $30,000. All sorts and conditions of men and women came in on the cheap rates. They were "without distinction of race, color or previous condition of servitude." Women and young girls with less than $too to their names became "plungers" in the realty market, and with their few dollars of spare cash tried to tie up property worth thousands, expecting prices to go soaring without limit, and that their contract for a deed on which $50 cash had been paid would be worth a fortune in ninety days. Be it noted, the pioneer and old-timer were not the promoters of these schemes. They willingly sold their property before the great game of inflation began, and were out of the market. The newcomer who had seen things done in Wichita or elsewhere was the one who made the big profits in corner lots, or who took a check for $50 or $100 on a contract, the balance to be paid in sixty days, with the certainty that the deposit would be forfeited and his lot returned to him at the end of the two months. But inexperienced women were not the only ones that lost their heads. Men of affairs whose hair was turning gray plunged deep enough to ingulf themselves and their fortunes in the end. Mortgages went on record as fast as deeds, and the obligations to pay generally exceeded the "spot cash" in the transactions. The banks were the first to take a conservative view of the situation. They refused to finance any more deals in outside townsites, or in new subdivisions in the city. One of the daily papers put a man on for a month to make a table of all the mortgages on the property in Los Angeles county. This table showed when the mortgage was recorded, the
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amount of the note, when due, and a legal description of the property. When the work was done, the exhibit of indebtedness was so colossal that the paper did not dare to make public the knowledge in its possession. Soon these obligations began to come due, and there was so active a demand for money that interest rates, which had been 6 per cent., where the debt was part of the purchase price of the land, and up to 8 per cent. in other cases, ran up to 13 per cent. The local banks were very loath to lend money freely, but a San Francisco savings bank came in and loaned $3,000,000 in a few months. The agent of the bank made these loans so judiciously that very little of the property had to be taken for the debt, and what was taken was sold later, so that the bank lost nothing. Of course, scores of people whose load of debt was out of all proportion to the value of the property, could not borrow at all, and were foreclosed out of all they had. Fortunes on paper were obliterated, and men who had been clerks, mechanics or day laborers before they reached Los Angeles in the "boom," then had blossomed out into financiers, set up costly establishments, with three or four servants and a carriage, counted their wealth at thousands, tens of thousands, hundreds of thousands, found themselves keeping house in three furnished rooms at $20 a month, and their wives doing the cooking and washing, as they had done before. There are men in Los Angeles today who are practically pensioners on the public, who rolled in wealth for a few months during the "boom." It was no infrequent thing for a real estate agent to make a thousand dollars by writing his name twice in the same day. He took an option on a lot, put up a hundred dollars, got the purchase reported on the street, and before night assigned his contract to someone else, who paid him $1000 to get the "bargain." "Millionaires of a day" these rich men of the great "boom" have been aptly called.
During this time of speculative excitement, good orange groves were cither neglected or cut up into town lots; the rich alfalfa pastures were allowed to die out, the owners being too busy selling real estate to cultivate their farms. The idea was that the whole country, from Tehachepi to the Mexican border, would be needed for building sites, 25-feet front by 150 deep, to supply the demand. From 1000 to 2000 new people a month were arriving, and it looked as if the whole human family were coming here to live "on climate and swapping corner lots."
The "boom" collapsed in just about twenty-four hours, and the people woke up from a pleasant dream to a very serious reality.
The "boom was burst."
RESIDENCE OF ROBERT F. JONES, SANTA MONICA.
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MEN OF ACHIEVEMENT IN THE GREAT SOUTHWEST.
CHAPTER VII.
AFTER THE CRASH.
The causes that led to the collapse of the "boom" were various. Besides the unjustifiable inflation of values, the laying-out of six townsites where there was room for only one, and the laying out in the city of subdivisions to furnish homes enough for half a million people, affairs all over the country were not prosperous. Business men were making less money. Mr. Cleveland's first term as President was coming to a close, and his last mes- sage to Congress disquieted men's minds. Again, one of the best-paying industries in California, grape-growing, was threatened with extinction. The mysterious disease, which destroyed almost every vineyard in Southern California, was doing its work. In two years the industry south of Tehachepi was wiped out. The white cottony cushion scale was threatening a similar fate to the orange groves. Eastern papers, which, with a few exceptions, knew little or nothing of Southern California, ignorantly attacked the section. It was contended that there was little here of a permanent nature; that the "boom" had no basis what- ever to rest on; that the collapse was natural, and that conditions would slip back to those prevailing as a rule during a century of little progress. There was a notable exception to this hostility of the eastern press. That was the New York Sun. In 1883 Charles A. Dana paid Los Angeles a visit. He made a special study of all conditions, social and climatic, and of the soil and its products. He saw that there was a basis for natural, legitimate growth here, and, in a series of specially-prepared editorial articles in The Sun, contended that there lay a great future before Southern California. There is no doubt that these articles did much to stem the rising tide of prejudice against the section created by the press generally. Meantime, the local press came gallantly to the defense of the country. The Santa Fe Railroad had just been completed, and was spending a good deal of money in branch lines. Passenger rates from the East were reasonable. Thousands of persons had spent a winter or a year in California, and had returned to their eastern homes to spread abroad the praises of a land where snows were unknown ; where frosts were never heavy nor of long continuance; where fields were clad in vivid green in January; where roses bloomed all winter long, and mocking-birds made the mornings vocal with song. In 1880 all Southern California contained only about 64,000 people. In 1890 this population was over 200,000. Here were over 136,000 newcomers, who were writing to their friends at the East to come here and enjoy a climate which, winter and summer, "let people alone." It was not a struggle against the cold in winter, nor against the heat in summer. Then the people had been driven back from speculation in real estate to culti- vate the soil. The planting of new orange groves began. There was a great demand for food for the increased population ; butter, eggs, cheese, poultry and other articles of food were coming from the East. The produc- tion of these, here, began in earnest. The damp lands were seeded to alfalfa, and herds of grade cows were multiplied. So great was the demand for young orange trees that those that had the first ready to put in orchard rows got as much as $10,000 for the nursery stock on a twenty-acre patch.
A "special providence" has seemed to take care of Los Angeles. In 1888 Chicago people came in here and bought up the old street-car lines, out of which they proceeded to construct a cable-car system, which extended over the greater part of the city. This cost, perhaps. $2,000,000, most of which was paid out in wages. Then came the Oxnard Brothers, and put up a great sugar factory on the Chino Ranch. The people of the city and of the surrounding country manifested supreme courage. They never lost faith in their city or district. In Los Angeles the building of streets and sewers, including the great outfall sewer, was carried on vigorously in the face of the collapse. The City Hall was completed, as also the County Courthouse. In 1890 a syndicate of San Francisco capitalists came here and spent perhaps $2,000,000 in a system of electric railroads, and that kept things moving all one hard winter. Laboring people had work, and that kept other business interests from suf- fering loss. So, also, the year after the "boom" burst, Thomas B. Burnett came out from St. Louis. He was backed by ample capital, representing, as he did, Richard C. Kerens and Geo. B. Leighton. These people proceeded to construct the Terminal Railroad system, on which in the next few years more than $3.000,000 was expended. The Santa Fé kept building local lines, one, to San Diego, being ninety miles long. The Southern Pacific built from Saugus to Santa Barbara.
When Hannibal defeated the Roman legions at Canna, the Senate passed a vote of thanks to Varro, the Roman general, "because he had not despaired of the Republic." The Senate also set up for sale at public auction the land on which the victorious Carthaginian was encamped, and it sold at its full value. The same indomitable courage burned in the hearts of the people of Los Angeles when the great speculative bubble burst. In 1888 the Chamber of Commerce was organized, gathering in its membership all the resolute, determined,
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COR-FOURTH AND BROADWAY EEEE
LEEEEE COR. THIRDAND SPRING
OUR BUSY STREETS
COR. THIRD AND BROADWAY
LOOKING NORTH ON BROADWAY
BAOHK
SECOND AND SPRING
COR. FOURTH AND SPRING
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progressive spirits of the city. This noble band began at once to work with wisdom and energy in all ways for the prosperity of Southern California. For fifteen years this great work has been carried on without interruption. Tons of printed matter, millions of carefully-written words, have been sent on their "winged way" to tell of the most charming land on the footstool of the Most High, and of the most beautiful city inhabited by the human family. By the far foresight and open-handed liberality of this band of earnest business men, exhibits of the products of Southern California have been made at New Orleans, at Atlanta, at Chicago. at San Francisco and at Buffalo. Foreign countries have been invaded, and the wines, fruits, minerals and manufactures of this section have been made familiar to the world.
And the "bursting of the boom" became but as a little eddy in the great stream, only as the intermission of one heart-beat in the life of the pulsating section so full of vitality and resources for growth. In population, in material wealth, in moral development and spiritual uplifting, this Land of Sunshine has gone on increasing at a pace never before known. The several enumerations of the census, national or local, the assessments of property for taxation, the records of building and all other indices of growth, combine to demonstrate that there was scarcely a halt in the development of Los Angeles or of the beautiful towns springing up around this metropolis of the Great Southwest. The speculative inflation of values was all that perished in the collapse. The great solid substratum of merit remained, and the work of building up a great commonwealth was scarcely checked for a day.
RESIDENCE OF T. H. DUDLEY, SANTA MONICA.
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MEN OF ACHIEVEMENT IN THE GREAT SOUTHWEST.
CHAPTER VIII.
SOME DULL DAYS.
The opening of the last decade of the nineteenth century brought financial trouble so widespread that hardly any portion of the civilized world escaped. The great Baring Brothers' ventures in Argentina began to bear their bitter fruit, and the embarrassment begun on the banks of the Rio de la Plata affected London, then New York, and on to San Francisco and Los Angeles. Industries were paralyzed for lack of funds at all centers. The change of national administrations in the United States after the election of 1892, and the long struggle to pass. a new tariff bill, accentuated the difficulties in this country. Meddling with tariff schedules or with the coinage. laws of a country must always result in commercial disturbance. The long-drawn-out contest, lasting eighteen months, over the Wilson Tariff Bill, was disastrous to business. In 1894 came the railroad strike, precipitated by the wild and vicious leadership of Eugene V. Debs. This tied up nearly all the railroads in the country for weeks.
The inevitable result was industrial stagnation. Coming as all these influences did so soon after the unbridled speculation of the real estate "boom," kept things in a state of chronic dullness more or less acute. That the condition was no worse was owing to the indomitable courage of the business men of Southern California, and to the really superb resources that underlie our progress. In 1888, the year after the "boom" collapsed, the late Maj. George H. Bonebrake and his business associate, Hon. John Bryson, erected the solid and handsome build- ing on the corner of Spring and Second streets. As evidence that there was no unnatural inflation in the values. of central business property, it is enough to note that the city received $1000 per front foot for the lot on which this building was erected. Today it is worth $2500 per foot, with the building removed. It was a handsome
five-story building as originally put up. Mr. Bryson has just completed the addition of two more stories. In 1887 the Witmer Brothers and their associates put up the California Bank building, on the corner of Second street and Broadway. The Y. M. C. A. directors, a year or two after, in the midst of the dull days, erected the hand- some building occupied by that admirable organization until a few weeks ago. In the next year or two John M. Griffith, one of the early pioneers of Los Angeles, erected the Potomac building, and in 1892 Judge John D. Bicknell erected the building occupied by the Los Angeles Furniture Company. Dr. Edgar followed with his building, and the Byrne estate with that on the corner of Third street and Broadway; and then Harris Newmark, one of the very early and progressive pioneer merchants of the city, put up the Blanchard Hall building, making this block, on the west side of Broadway, between Second and Third streets, a typical Los Angeles block. It illustrates the progressive spirit, the courage and enterprise of the people of this metropolis, for it was all done just after the collapse of the great "boom," in the face of the world-wide stagnation prevailing between 1890 and 1896. Following down Broadway, on the next block, in these dull days, Homer Laughlin put up a six- story fire-proof building, which would do credit to Chicago or New York. The Bradbury estate erected, on the corner of Broadway and Third streets, another building of the same modern type and in the most substantial and lasting manner. The cost of building was low in these years, and these far-seeing business men saved large sums of money by building when they did. Incidentally they slowed their confidence in the future of Southern California, gave employment to many worthy men in need of the wages they received, and held the city from going backward. Simultaneously came in the late T. D. Stimson, who erected a handsome six-story building on the corner of Spring and Third streets, called the Stimson building, and as soon as that was completed, began another, the Douglas building, on the opposite corner of the same streets. Others of like spirit put up similar busi- ness edifices on other parts of Spring and Broadway and on the cross streets. The result was that less stress was felt in Los Angeles and in the surrounding towns and country districts during these years of hard times than in any other section of the country or portion of the world.
But it was not all flush times. Business and industrial affairs were good only by comparison with condi- tions elsewhere. By the year 1895, in the winter lapping over into 1896, there was a good deal of distress among the class of people who live from hand to mouth on their daily wages. So sore was the distress that a public subscription was taken up to put the unemployed at work in the public parks. Elysian Park was greatly improved by the use of this money-more than $25,000-and many worthy people were thus saved from suffer- ing the actual pangs of hunger.
Meantime, out in the country, orchardists were paying close attention to their trees, and the crops of citrus and other fruits were increasing. Prices were not high, but there was a margin of profit. The keeping of dairy
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cows was extending; farmers began to pay more attention to fowls, and less money went out of the section for butter. cheese, eggs and dressed poultry.
During the whole of this period the inflow of new settlers was little checked by the dull times at the East. 'The population increased every year, including that after the "boom" collapsed. More or less new homes were called for, and the building of these gave a large number of men profitable employment. Many men of large wealth came not only to this city, but to North Pasadena and to all the foothill country. Some of these erected palaces for their homes. Thomas D. Stimson, already mentioned in this chapter, put up a home on Figueroa street which must have cost $100,000. In 1894, in almost the worst of these dull days, Mrs. Eliza Wilson erected a fine block on Broadway, which very properly bears her name.
Before the "boom" collapsed the newspapers of the city were expanded out of all proportion by real estate advertisements, for which liberal prices had been paid. With the collapse, this business fell away. To cut the papers to the needs of actual business and the measure of their income under the new conditions, would have been to betray the "nakedness of the land" to the eyes of outsiders, who were only too ready to proclaim the fact that Southern California was no longer a place to attract men with capital. To fill the place once occupied by paid business, the newspapers-and The Times may claim the credit of occupying the head of the class in this respect-printed more and more of the best obtainable reading matter at hand. Matter descriptive of the attractions of the climate and soil of Southern California was given preference. The Midwinter editions of this journal, filled to the extent of nearly a hundred pages with the most carefully-prepared matter of this character to be had, were sent out in tens of thousands. These articles on the attractions and resources of the section were published "without money and without price."
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