Who da man?
That’s the question that has perplexed this blogger for years.
By most accounts, William Boyce Thompson (1869-1930), the wily financier who was ambassador to Russia and left a fortune to botanical research, was the great patriarch of the family. Biographies describe him as a brilliant, though manipulative, self-made millionaire.
Now a dissident family faction contends that WB’s father, William Thompson (1838-1900), was in fact “the man.” The gist of their argument is that William Boyce was born on third base, thinking he hit a triple. William Thompson started with less than nothing.
This break-away group argues that William Thompson— a self-made man who established lumber operations, mines, and constructed buildings in the hard-scrabble Montana Territories— bankrolled his son’s early ventures. Without his father’s early money, William Boyce may not have gone anywhere. In fact, most of William Boyce’s early ventures, bankrolled by his father, ended in failure.
OK. I’m the only one in this dissident group. But the more I think about it, the more I think it’s true. During his first 10 years in business, William Boyce was completely dependent on his father financially. The father signed on the son’s first big deal, the Shannon Mine in Clifton, Ariz. It wasn’t until his father died that William Boyce came into his own.
There’s also the matter of who worked harder to make his fortune. The father painstakingly built a lumber empire in Montana, moving his family from one mining camp to another until finally settling in Butte. He created wealth. The son ultimately made his fortune by playing, sometimes manipulating, the stock market. That’s less worthy in my book.
“The Magnate,” the seminal biography of William Boyce Thompson, written by Yale Professor Hermann Hagedorn, makes it sound as if William Boyce Thompson was the man, especially the sections that detail how he bailed out his father’s estate. Hagedorn, who was paid by William Boyce Thompson’s family to write the biography, also paints an unfavorable psychological portrait of the elder Thompson, who was harshly critical of his son’s business instincts, which later turned out to be incredibly keen.
Research conducted by Hagedorn, and perhaps left in Library of Congress files for someone else to find, tells a somewhat different story. One of Hagedorn’s sources, a Palmer, writes that “during his early years in Boston and New York, WB drew on his father every Saturday for the week’s expenses.” This was after the father and his sons had established the Thompson Investment Company in Butte, and William Boyce had gone to Boston and New York to sell shares to investors.
A Walter Lewis told Hagedorn that the elder Thompson backed his son heavily when he was getting started in New York. “The Directors of the Silver Bow National Bank [in Butte] cautioned him against letting his faith in his son run away with his better judgement,” Lewis wrote. The father supported the son anyway, creating a perilous situation at home.
WB’s drafts on the Thompson Investment company during his first three years in New York “drained its treasury dry and finally exhausted its credit,” according to Philo Hanson, who was prominent in Butte mining, investment, and real estate circles at the time.
As a result, the Thompson Investment Company was never more than half a jump ahead of the sheriff. Some of the older Thompson’s political opponents, especially those of a different faith, were not above persuading a bank to call a large loan at twenty-four hours’ notice. After such a ‘squeeze play’ occurred, Hanson wrote, “there was a frantic scramble ending in the triumph of virtue over guile when some pillar of the community came to Thompson’s support.”
Arthur Smith, who worked in Butte city government for the elder Thompson and later took over the East Ely, Nevada, operations for William Boyce, said that WB’s demands on his father while in New York “made money pretty scarce in the offices of the Thompson Investment Company. WB and his father were $27,000 in the hole on [the Shannon mine] before they turned a spade.”
Smith notes that the deed for the Shannon mine, WB’s first big success, “was paid by a check of $2500, drawn by Arthur Smith and signed by WB’s father.”
R. Plate remembers that William Thompson didn’t think his son had “much brains, and, when WB went East, expected the worst. One day, while WB was trying to get a foothold in Boston and New York, O.J. McConnell found the old man sputtering with exasperation and anger.
“That damn fool boy of mine is doing the most ridiculous thing I ever heard of,” said the elder Thompson, according to McConnell, who read the telegram which had roused the old man’s ire. WB, it appeared, wanted $10,000 to charter a special car to take some New England financiers to Clifton to examine the Shannon Mine.
McConnell advised him to take the matter under consideration and, the next morning, when he found Thompson was still obdurate, volunteered to advance the money himself. “That broke down the old man’s defenses and he sent the money, but with many misgivings,” wrote McConnell, who later managed William Thompson’s estate.
According to Edward B. Howell, the elder Thompson’s lawyer, WB wanted $2000 to finance the special car. At the time, he was living in the Waldorf Astoria at a cost of approximately $100 a day. As for the accommodations, “He thought it necessary to make a showing,” Howell wrote.
Gertrude Hickman, WB’s wife, noted that in 1899, the year before his father died, her husband “did not know from day to day where his next dollar was coming from. In 1900 his father died. A year or so before when he had sold his lumberyard, the old man had been worth half a million dollars, but when he died he left one hundred thousand dollars in debts. WB set to work to pay them before he laid aside anything for himself.”
The estate also included title to a number of virgin claims in the Clifton, Arizona copper district, W.F. Bartholomew, an Arizona mine owner, told Hagedorn. The claims turned out to be worth quite a bit of money. According to Howell, William Boyce conspired with some other large investors in Shannon to keep the stock off the market for a year and half. The move tied up the elder Thompson’s estate for a while, but it wound up dramatically improving the stock’s value.
“Mr. Thompson conceived the idea of putting these claims into a corporation,” wrote Bartholomew, “and forming a new copper company, which he did and named it the Shannon Copper Company, which was more or less successful in its early days,” wrote Bartholomew.
By February 1901, the newly formed company had $300,000 in its Treasury and its mines had proved richer than expected. The company’s stock had risen from $2.50 a share to $10 a share. “No stock of the Shannon Copper Company,” W.B. wrote to his brother, “will be sold now under $12 a share, and we will only sell ten thousand shares at that price. I have put all our shares in Escrow under the pool agreement that we spoke of.”
The strategy worked, Bartholomew wrote. “Mr. Thompson was in Boston as Secretary of this company for three years and as a result of three years of hard work he accumulated about $50,000 in real money, according to his own statement to me. Mr. Thompson then went to New York and at this time a big bull market had started and it was a time when margin requirements were not very high and he succeeded in running this $50,000 in one year’s time to an excess of $1,000,000.”
So, who is the man? I guess history will have to be the judge. As an aside, judging by the personalities involved, I can’t imagine the partners engaging in this kind of banter.
“You da man.”
“No, you da man.”
“But how can I be the man, if you da man?