Captain of Industry or Robber Baron: J.P. Morgan
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J.P. Morgan was a post-civil war “captain of industry,” separating him from the other “Greats” such as Cornelius Vanderbilt, John D. Rockefeller, and Andrew Carnegie because of his motives and his upbringing. A “robber baron” is most simply defined as an individual who has financial ambitions that cause him to knowingly take advantage of others for his own personal gain. A “captain of industry” seeks solutions to common problems, and though the outcome may prove to be monetarily beneficial, others are not harmed in the process. John Pierpont Morgan was born to Junius Spencer Morgan, patriarch of a wealthy banking family in Hartford, Connecticut and one of the most revered financers in London. Under his father’s direction, John became the American agent for his father’s firm in New York, going on to start his own firm with a cousin. That attempt failed, so he became partner in the New York firm Drexel Morgan and Company which later became JP Morgan and Company.
Pierpont adhered to “Gentlemen’s understanding,” which stated that bankers would not advertise, compete, or accept new clients without clearing it with the client’s prior banking institution, but his tactics for conducting business were much straighter forward. His deals were on a take it or leave it basis, earning him a reputation of being brusque and abrupt but also fair. In a railroad deal with Andrew Carnegie, Pierpont gave the steel industry tycoon $70,000 instead of the predetermined $60,000 because Pierpont believed his evaluation of the company was much too low. He did not want to dominate the financial area; his ambition was to ensure that economics were run efficiently and soundly. His interest in organizing assets and investments coined the term “Morganization.” Due to his reputation for doing exactly what needed to be done when it needed to be, he was chosen to stabilize the railroad industry, Carnegie Steel Company, and the merger between Edison General Electric and Thompson-Houston Electric.
An integral part in forming a syndicate that replenished the US government’s depleted gold reserve in order to relieve the Treasury crisis, J.P. Morgan exhibited the power of his financial resources and international connections by loaning the Treasury $65 million dollars in gold during the Panic of 1893. When the stock market crashed in 1907, he leapt into action, helping reorganize large government deposits and preserve the solvency of several major banks and corporations. A system that intertwined major banks and corporations to maintain financial integrity sprang from his suggestions as well as a National Bank and kept the nation’s economy secure. John Pierpont Morgan was one of the most innovative and influential captain of industries. Because of the silver spoon in his mouth when he was born, his focus was never on the money, and his matter-of-fact personality ensured it was on process and order instead. His motivation was organizing finances in the most beneficial and productive way possible; becoming one of the wealthiest men in America was simply a side effect of that objective, and that set him apart from the robber barons in that era.