Most of the
world's gold is locked deep underground--embedded in hard rock.
But California gold was different--easily accessible to anyone
with a few simple tools and a willingness to work hard. Also unique
was the political environment. California became a part of the
United States just a few days after Marshall's discovery; and
so the gold rush came before any meaningful government could be
established. It was an unlikely intersection of anarchy and geology.
Unlike anywhere else, the gold in California was easy to get and
free for the taking.
It was free--and
it was plentiful. Soon there was too much money in California
and too little of everything else. The lessons of supply and demand
were often painful. A forty-niner who earned a dollar a day back
home, could make twenty-five dollars in a day of mining--but that
was often just enough to buy dinner.
It wasn't
just Sutter's gardens that were raided--by the end of 1849, his
grand empire had collapsed completely. Sutter did not have the
entrepreneurial spirit of the new Californians and he didn't have
gold fever. He wanted an agricultural empire and refused to alter
his vision. In the new California, Sutter was simply in the way.
The 49ers literally trampled his crops and tore down his fort
for the building materials. Dejected, disillusioned, he eventually
left the state. The man who had the best opportunity to capitalize
on the discovery of gold--never even tried.
Instead, California was filling up with a very different kind
of businessman--and it was filling up fast. Camps sprouted up
and evolved into ramshackle boomtowns to serve the growing population--places
with accurate names like: Hangtown, Gouge Eye, Rough and Ready,
and Whiskeytown. Places to avoid--were it not for the gold. Places
that were wild, open, free.
The class
society of the east was gone and opportunity was everywhere. It
was pure freedom, and a pure free market. People who had a skill
were in demand regardless of who they were. Women, for example,
who couldn't earn much money back home, found their domestic skills
had considerable value here.
Part of the
reason they could charge so much for their talents was the fact
that women were rare in the early gold rush days.
Women weren't the only ones to realize the entrepreneurial opportunities
of California. People from all walks of life quickly understood
that there was just as much money to be made serving the miners
as there was digging for gold. A steamboat operator could earn
40,000 dollars in a single month--a chicken farmer could sell
each precious egg for fifty cents.
King of the
wheeling, dealing entrepenuers was Sam Brannan. The man who pulled
the trigger on the gold rush was expanding his sphere of influence--and
earning unheard of profits. While miners talked of gold, Brannan
shrewdly bought up carpet tacks-- every tack in California. By
cornering the market, he could extort huge profits, a technique
he executed flawlessly--over and over. But Brannan was only the
first in a long line of entrepenuers who made their fortunes without
digging for gold.
In
1853--according to legend--this man stitched a pair of pants out
of canvas; sturdy pants that later became popular with the miners--very
popular. His name:Levi Strauss.
But during the gold rush, Strauss was best known for his prosperous
dry good business. It wasn't until 1872 that he added a critical
innovation to canvas pants, the metal rivet--a breakthrough that
would change the course of American fashion.
This New York butcher decided one
day to walk to California. Eventually, he opened a meat market
in Placerville--and later took his profits to Milwaukee, where
he set up a meat processing plant. His name was Phillip Armour,
and the Armour meat packing company became one of the nation's
largest.
Armour's neighbor in Placerville,
was an enterprising wheelbarrow maker who dreamed of bigger things.
After saving every dime for six years, he left California for
his home in Indiana. There, he plowed his profits into the family
wagon-making business.
The man's name was John Studebaker--and the family enterprise
would go on to build covered wagons for the Oregon-bound pioneers,
and later--automobiles.
These two businessmen also looked west and
saw opportunity. Sensing the unsettled atmosphere in California--they
offered what many miners desperately wanted: stability. The offered
secure, honest banking, transportation, even mail delivery. They
were Henry Wells and William Fargo. Their company, Wells
Fargo, became a giant in the banking industry.
The most famous celebrity of the gold
rush era came to California as a complete unknown and took a job
writing for the San Francisco Call. It wasn't long until
his fanciful story about a frog jumping contest in nearby Calaveras
County thrust him into the national spotlight. His name: Samuel
Clemens--Mark Twain.
Clemens boss at the Call was also destined to become a
best-selling author, Brett Harte. Unlike Clemens, Harte wrote
almost exclusively about western characters--colorful stories
about miners, bandits, and gamblers. His tale of an orphaned baby
adopted by a group of rough miners would make him famous and rich.
For every famous success, there were a thousand smaller stories
of people who used their wits, not their shovels-- to find a fortune.
Creative entrepenuers were everywhere--looking for a new angle--a
new way to make money, more money.
In 1848 and early 49, everyone was making money--but the party
didn't last forever. For most miners, it didn't last very long
at all.
