USA > Pennsylvania > Schuylkill County > History of Schuylkill County, Pa. with illustrations and biographical sketches of some of its prominent men and pioneers > Part 13
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Another injurious element in the Schuylkill trade was the large number of small operators, many of whom were without sufficient capital to conduct their business prop- erly, and were soon financially embarrassed and caught in the toils of the "middlemen," to whom they sold their coal at reduced prices, under the vain hope that sometl.ing would turn up opportunely in their behalf. They were in a great measure the cause of the ruinous prices that so frequently prevailed. Subsequently to the period now under review Mr. Cullen, then president of the Philadelphia and Reading Railroad Company, was reported to have remarked that the mining of coal in the Schuylkill region would not become profitable until the small operators were broken up.
The Schuylkill coal operators, however successful in attaining a large production generally, failed in an essen- tial part of their business-the marketing and sale of their product. Without organization or unity for the conservation of their interests as producers and venders of coal, they rushed into the market in destructive com- petition with each other, over one hundred in number, as though their object was to break down the market, or to produce a larger tonnage than their neighbors, or
perchance to raise money to pay their hands and lift some promissory notes. It was only when their affairs became desperate, when a crisis was nearly impending. that a call was made to halt and a spasmodic effort made for self preservation. Under such management, or rather want of management, the periodical distress of the trade was inevitable.
During the ten years ending with 1849 there were only four years of prosperity in the Schuylkill trade. On 10,- 655,567 tons of coal sent to market from the region dur- ing that period there was not probably, on an average, any profit realized by the operators. But if they derived no emolument from their business, other interests in the region, dependent upon the coal trade, flourished and prospered in an eminent degree. As an evidence of this, we need only state that the population of Schuylkill county was 29,072 in 1840, and in 1850 it had increased to 60,713, or over 200 per cent. in ten years.
FLOODS IN 1850.
In the spring of the year 1850 the Schuylkill coal trade wore a gloomy aspect. It was universally con- ceded that unless something was done to arrest the downward tendency of the trade the operators must sink under the difficulties with which they were contending. An appeal to the landowners and to the transporting companies for aid was in contemplation. A disastrous crisis was closely impending. The sheriff had already closed out some of the colliers, and others were "hanging on to the willows." This deplorable condition of affairs continued until the 19th of July, when by the interposi- tion of Providence a great flood swept down the valleys of the Schuylkill and the Lehigh, which suspended navi- gation for a period, restricted the supply of coal and changed the whole aspect of the trade. Hope again lent its inspiration to the operators; and when on the 2nd of September a still greater flood descended than the first, rendering it certain that the prices of coal must advance, they felt that their situation had been affirmed.
The storm of the 18th and 19th of July, 1850, was of an extraordinary character for that season of the year, and it was particularly severe in the valley of the Schuyl- kill. Property to a vast amount was destroyed. The boatmen suffered heavily by the loss of boats, the coal operators by the loss of coal and the inundation of the mines. The damage to the Schuylkill canal was con- siderable. It was not until the 28th of August that the navigation was restored.
Only five days after the movement of loaded boats had fairly commenced-on the 2nd of September-a second flood descended, which destroyed the Schuylkill naviga- tion for the remainder of the year. The destructive force of the flood was tremendously augmented by the bursting of the Tumbling run reservoir, and, as a con- sequence, the breaking away of the numerous dams in the Schuylkill river. The reservoir covered twenty-eight acres of ground, was forty-two feet high at the breast of the embankment, and contained over 23,000,000 cubic feet of water. The effect of suddenly precipitating such
59
FLOODS IN 1850-TRANSPORTATION RIVALRY-INCREASED CONSUMPTION.
an immense volume of water into an already swollen and Richmond to secure the large tonnage of the year. This covert movement excited the suspicion of the managers of the Schuylkill Navigation Company, who believed the canal was being deprived, by some underhanded measure, angry flood, roaring and dashing through a narrow mountain gorge, is beyond imagining. It was the highest freshet, and the most destructive to life and property, known from memory or tradition to have visited the of its portion of the trade, and that the terms of the ar- Schuylkill. At some places the river rose twenty- five rangement between the two companies were being violated. Instigated by these impressions, the managers, with great precipitancy, made such extraordinary reductions in the tolls on the canal that the whole trade was thrown into confusion. The results of these complications were un- precedentedly cheap transportation, a spirited demand for coal at low prices, a greatly augmented production and supply, and the introduction of anthracite coal into new markets. Over one half the supply was furnished, as previously, by the Schuylkill region. The supply of anthracite from all the regions in 1851 was 4,428,919 tons, an increase of 1, 151,554 tons over the supply of 1850. The increase in the supply from the Scuylkill was 535,656 tons over the supply of 1850. feet above its ordinary level, and covered the Reading railroad track at several points for the depth of three to five feet. In referring to this freshet the president of the Schuylkill Navigation Company says: " A flood with which nothing that has heretofore occurred in the val- ley of the Schuylkill within the memory of man can be compared. In the great elevation of the waters, in the destruction of property and life, and indeed in all its accompaniments, no living witnesses have seen its parallel. The most stable buildings were compelled to yield to the fury of the raging waters, and the very foundations of the mountains in many places were actually swept out."
After the September freshet the prices of coal on board vessels at Port Richmond advanced $1 per ton, which prices were maintained until the close of the season. The cars and machinery of the Philadelphia and Read- ing Railroad Company were taxed to their utmost capacity, day and night, to supply the urgent demand for coal after the September flood. The amount of coal transported by the company during 1850 was 1,351,507 tons, an increase of 253,745 tons over the tonnage of the preceding year. From the Schuylkill region, including the Lykens valley, there was an increase in the supply of 59,677 tons compared with that of 1849.
RIVAL MARKETS AND TRANSPORTATION LINES.
The antagonism in the New York and eastern markets of the Lehigh Coal and Navigation Company, the Dela- ware and Hudson Canal Company, and the Pennsylvania Coal Company, to the Schuylkill coal operators and dealers assumed a determined shape in 1851. It was alleged that a combination had been formed by those companies to conduct their sales so as to command the whole market as far as possible, leaving the Schuylkill region to supply only so much coal as the combination might be unable to mine or transport. An effort was made to secure a mutual good understanding with these parties in reference to charges for transportation and to the quantity to be mined, but they were determined to lend no hand to effect an arrangement. The Schuylkill region had heretofore supplied more than one-half of the anthracite coal consumed, and the parties interested in the mining and transportation of coal from that re- gion were not willing to submit to or acquiesce in a policy by which they would be unable to maintain their accus- tomed position, and command their usual proportion of the trade. The managers of the Philadelphia and Reading Railroad Company resolved to adjust their charges so as to meet the occasion and command a fair proportion of the trade. Before, however, giving publicity to the course upon which they had determined, arrangements were made with the parties occupying the wharves at Port
INCREASED CONSUMPTION.
It was a cause for wonder and surprise that the heavy supply of coal in 1851 had almost disappeared by the opening of spring in 1852, and the market was seeking with avidity a fresh supply. The notable increase in the consumption of coal was due to the relief of the business depression, the resumption of operations at the iron works and other manufactories that had been totally or partially suspended for a long time; the impulse given to ocean steam navigation and the coasting trade; the ex- pansion induced by low prices, facilitated by the exten- sion of the railway system of the country into new mark- ets; the increase in population, and the great scarcity and high price of wood. During the whole of 1852 the an- thracite coal trade was prosperous. The operators re- ceived a fair return for capital invested and labor was liberally rewarded.
A statistical chart, prepared by Benjamin Bannan, Charles W. Peale and Colonel J. Macomb Wetherell, for the World's Fair, held in New York in 1853, furnished the following statistics of the Schuylkill coal region: Number of collieries, 115; red ash, 58; white ash, 57; operators, 86; miles of underground railroads, 12672; steam engines employed in the coal operations, 210; aggregate horse power, 7,071; number of miners and laborers employed at collieries, 9,792; miners' houses, out of towns, 2,756; capital invested in collieries, $3,462,000; of which there was invested by individual operators about $2,600,000; number of yards in depth of the deepest slope, 353; thickness in feet of the largest vein of coal, 80; of the smallest, 2.
The coal lands worked in 1853 were owned by six cor- porations and about sixty individuals; about twenty-five of the owners resided in Schuylkill county; the remainder abroad. The entire coal production of 1853 was the re- sult of individual enterprise. The coal royalty in the region averaged about thirty cents per ton. The income to the landowners in 1853 for rents was nearly $800,000. There were several obstructions to an even flow of the
60
HISTORY OF SCHUYLKILL COUNTY.
coal trade in 1853. In the fall of 1852 a decline in prices Iron advanced ninety and miners' wages from forty to fifty per cent. of coal occurred and some loss was sustained by dealers on their stocks laid in before the decline. Mistrusting that One of the most interesting events in 1854 was the presentation at the Mansion House at Mount Carbon, on the 11th of October, by gentlemen of Philadelphia inter- ested in the coal deposits of Schuylkill county, of a tea service of silver to Enoch W. McGinnes as a token of their appreciation of his invaluable service to the region in the development he so successfully made at the Carey the same condition would occur in 1853, they delayed making their purchases in the spring and influenced others to pursue a similar course, and, as a consequence, the production fell off largely. Until after the first of June the trade moved sluggishly and prices ruled low. After that the demand for coal improved, and by the middle of July it became importunate and could not be shaft at St. Clair. Mr. McGinnes sunk the first perpen- satisfied. Frequent local strikes by the miners, who had become demoralized by the advance in wages previously paid, reduced the yield of the mines and proved the fact that the higher the wages the less the percentage of pro- duction.
In the mean time the demand for coal for steamers, iron works and other manufacturing purposes became so great that coal, which sold at $1.80 at the mines in the spring, was run up to $2.50 and $3 before the close of the season. The consumption of coal had apparently over- taken the capability of the mines for production, and the supply was decidedly short, as was made quite apparent the following year.
A PERIOD OF PROSPERITY.
The year 1854 is remembered by those engaged in coal mining at that time as the "good year." It was indeed an extraordinary year in the history of the coal trade; extraordinary for the demand and high prices for coal, for the high rates of transportation, the high prices of provisions, the high prices of labor, and the stringency of the money market. Every department of business connected with the production and transportation of coal was distinguished for its prosperity.
The trade opened in the spring under the most auspi- cious circumstances. Coal was in great request. The market was in a depleted condition. The rush and struggle for coal which soon ensued surpassed the ex- pectations of the most sanguine. The operators were masters of the situation, and they would have been cen- surable, in view of losses in the past, had they not availed themselves of the rare opportunity to improve their for- tunes. The demand continued pressing, almost without pause, until the close of navigation, prices reaching $3.50 per ton at the shipping ports in the coal region.
The cost of the transportation of coal to tide water and the coastwise freights advanced in a proportional degree with the price of coal at the mines. Freight from Port Richmond to Boston advanced from $2 to $3.80 per ton.
Labor, and every material entering into the cost of coal, advanced in price in as great or a greater degree than that product, as will be seen by the following quotations:
'1853.
Flour per bbl.
$5.50
1854. $9.50
Corn per bushel
.70
1.15 .66
Oats
.42
Potatoes
.45
1.30
Pork per lb.
.07
.101/2
Beef
.08
.12
Lumber per M.
13.00
18.00
dicular shaft in the Schuylkill region, and demonstrated the fact that the great white ash coal veins of the Mine hill and Broad mountain ranges ran under the red ash series of the Schuylkill basin. He established the fact of the accessibility for practical working of the white ash coal measures throughout the entire basin.
OPENING OF MAHANOY VALLEY.
The extension of the Mine Hill and Schuylkill Haven Railroad to the Mahanoy region at Ashland was com- pleted in September, 1854. This was the first practica- ble and effective railroad to penetrate the great Mahanoy coal field. In anticipation of the approach of the rail- road a number of collieries were in a state of preparation, a large number of houses had been erected, and a con- siderable population had centered at Ashland and vicinity during 1854. The first car of coal sent over the road was from the mines of Conner & Patterson, and was con- signed to John Tucker, the president of the Philadelphia and Reading Railroad Company. Neither the branch railroads nor the collieries were ready for business, and the regular shipments of coal did not commence until the following spring.
The amount of coal sent to market from the Schuylkill region in 1855 was 3,513,860 tons, 417,958 more than in the preceding year. Judging by the amount of the pro- duction a superficial study of the trade of this year would indicate a satisfactory condition of prosperity. But a closer examination reveals the fact that the great volume of the business was the mistake and the misfortune of the trade; the operators were stimulated to make improve- ments and extensive preparations for an enlarged busi- ness, instead of nursing their resources and accumulating for a year or two. The consequence was overproduction, a plethoric market and low prices.
Impressed with the folly of the recklessness of the past, and smarting under the losses sustained in their business, a determined effort was resolved upon by a number of the leading Schuylkill operators to bring the coal business within the control of safe and rational principles. Early in February, 1856, a coal association was organized, with Samuel Sillyman, a man of sound judgment and large experience, as president. Meetings were held every Tuesday and Friday to deliberate upon the condition and prospects of the trade in the near future, to promote unity and steadfastness of action, and to devise measures for mutual protection and benefit.
Among the most effective causes of a drooping market in the spring of 1856 was the opening of new sources of
61
COMPETITION IN CARRYING-JOHN TUCKER'S MANAGEMENT.
supply. The new avenue to market from Scranton to New York had a malign influence on the trade ; not so much by what could actually be accomplished by that route as by its high pretensions and boastful promises. With all these blatant pretensions the total amount of Scranton coal sent to competitive points in 1856 was only 85,668 tons.
The rates of transportation to tide water for the year were of vital importance to the Schuylkill coal operators, and the promulgation of the new programme was looked for with great solicitude. The influx of coal from the Lackawanna region by a new avenue, and the candidature of the Lehigh Valley Railroad Company for a proportion of coal tonnage to its new road, made it of great conse- quence that a conflict between the transporting companies should be avoided and an equitable adjustment of rates be established. The miners of coal who were without transporting facilities of their own had become deeply sensible of the disadvantage they were laboring under in being forced into competition with large corporations possessing mining and transporting privileges, who could when so disposed sacrifice all profit in the mining to secure profit on the transportation of their product.
MORE RIVALRY.
About the first of May the president of the Philadelphia and Reading Railroad Company, John Tucker, having discovered that the tolls to Port Richmond were equiva- lent to the prices of the New York companies in the New York market, but were fifteen cents too high for the eastern markets, concluded to make a drawback of fifteen cents to the latter points and not disturb the rates to other points; because if he did the Pennsylvania Coal Company assured him they would reduce their prices for coal. This arrangement it was supposed would remove all difficulty, and restore animation to the Schuyl- kill trade. Frederick Frailey, the president of the Schuylkill Navigation Company, was no sooner apprised of this measure than he, either misapprehending the object or suspecting a design to take advantage of the Navigation Company, immediately announced a reduction in the toll by canal to Philadelphia of fifteen cents per ton-from 80 to 65 cents. This surprising movement unsettled the whole trade. The Reading Company, in order to maintain its relative position with the canal in the New York market, was obliged to reduce the toll on the road fifteen cents per ton, and the New York companies reduced the prices of coal in a corresponding degree. This reduction, so far from being of any service to the trade, added to the evil it was already suffering from. It created an impression abroad that there might be another season of destructive competition among the transporting companies ; and dealers and consumers withheld their orders in anticipation of still lower rates. The reduction did not benefit the operators-the only parties really suffering-as it was deducted from the price of coal at tide water ; and it proved an unnecessary sacrifice of profit on transportation, without increasing the consumption. The result of the year's business was
a decline of nineteen cents per ton in the price of coal at the mines below the low rates of 1855.
The amount of coal sent to market from the Schuylkill region in 1856 was 3,437,245 tons, a decrease of 76,615 tons compared with the supply of the preceding year. The supply from the Schuylkill region in 1857 was 273,376 tons less than that of 1876, and it was the first year since 1832 that this region did not furnish over half the entire supply of anthracite coal from all the coal fields. The position then lost has not since been re- covered, even with the accession of the Mahanoy region.
The market at the opening of canal navigation in 1857 was sufficiently stocked to supply immediate wants, and the demand was consequently very sluggish, and so re- mained for several months. The depression in business generally caused an interruption to the usual percentage of increase in the consumption of coal, and the capacity for production in the different regions was consequently greatly in excess of the requirements of the market The large New York companies entered into a desperate struggle and rivalry for the market, initiating their pro- ceedings by a reduction of about fifty cents per ton in the prices of coal, as compared with the prices of the preceding year. The trade progressed in a languishing way until September, when the ever-memorable mone- tary convulsion took place, paralyzing industry, destroy- ing confidence and credit, bankrupting thousands of busi- ness men and producing a general contraction or col- lapse in business transactions. Many of the operators had reached that condition when an additional feather's weight would break them down, and they now suc- cumbed.
EFFORTS TO ACQUIRE CONTROL OF THE COAL TRADE.
The Schuylkill coal operators early in 1857 entered into an arrangement with John Tucker, who had resigned the presidency of the Philadelphia and Reading Railroad Company, to assume the regulation of the Schuylkill coal trade. Mr. Tucker by his long acquaintance with the movements of the trade, the official intercourse he had held with the representatives of the different mining and transporting companies, and his ready tact, superior management and ability, was admirably qualified for the position. After due deliberation it was determined to give a plan submitted by Mr. Tucker a fair trial. Oper- ators representing over three millions of tons subscribed to the new arrangement. Mr. Tucker became the head of the coal association and assumed the duty of con- trolling the supply of coal, so that it could not fall be- low a paying price to the producer. His utmost skill and energy were applied to this work, but he must have ascertained that it was more difficult to manage the Schuylkill coal trade than the Philadelphia and Reading Railroad. The effort to regulate the trade and make it prosperous was a failure. The time was inauspicious and the trade incorrigible. After the financial crash in Sep- tember every operator was left to his own devices. Sales were made at the best prices that could be obtained. The result of the year's business was a great disappointment.
62
HISTORY OF SCHUYLKILL COUNTY.
On the 21st of January, 1858, the Delaware, Lacka- wanna and Western Railroad Company sold at auction in the city of New York 10,000 tons of Lackawanna coal, $1 per ton below the circular prices of the company at the close of the preceding year. Whatever the original object was in resorting to this unprecedented expedient, it became the usual practice of this company. The system of periodical sales of coal at public auction was interjected into the business as a permanent measure. This reprehensible practice has proved to the trade an incubus of the most blighting description. To obtain a monopoly in the market the profit on the carriage of the coal became the main object, to which the product of the mines was made entirely tributary. No other measure could be devised so well adapted to demoralize the trade and to depreciate the commercial value of the article sold. If the evil consequences of the practice were con- fined to the parties indulging in it, there would not be so much cause for complaint, but unfortunately they per- meate the whole trade; the prices obtained becoming the TRADE DURING THE FIRST FORTY YEARS. standard of value. By these periodical forced sales the mining interest as a specialty, its capital and the product of thousands of operatives have been disregarded and sacrificed-made a subservient auxiliary of a transport- ing company and of its stock jobbing operations. The low prices at which these sales of coal were made- always below the cost of production, adding the tolls-amounted virtually to a reduction in the rate of transportation on the company's coal, and to a monopoly of the Scranton coal trade at Elizabeth. The other coal companies and individual operators in the Lackawanna region could not pay the prescribed toll on the railroad and deliver coal at Elizabethport in competition with the company without sustaining a heavy loss, and their only alternative, therefore, was to sell their coal to the com- pany at any price they were offered. The Schuylkill operators viewed with great alarm the illegitimate methods pursued by the Delaware, Lackawanna and Western Railroad Company. In the exercise of its priv- ilege to both mine and transport coal that company threatened destruction to individual enterprise in the Schuylkill region. Having no transporting facilities of their own, the Schuylkill operators were virtually ex- cluded from the New York and Eastern markets unless large concessions were made in the charges for transpor- tation by the Philadelphia and Reading Railroad Com- pany and the Schuylkill Navigation Company. Low tolls and freights were absolutely necessary in this crisis. It was the interest of those companies to support the region from whence they derived their tonnage. The navigation company made no abatement in the tolls, but allowed the whole burden to fall upon the poor boatmen, in an unprecedented reduction in freights. Just enough was conceded by the Reading Railroad Company to in- duce the producers to continue operations, taking care to exact from the trade a profit to base a dividend upon. This contracted and illiberal policy caused great dis- satisfaction in the region in 1858 and 1859, and a strong effort was made to build a railroad direct to New York, I the Pottsville Scientific Association in 1858, he says:
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