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Railway Giants: He Started as a Pool Hall Cashier, Eventually Became an Influential Investor. Stilwell Followed God's Will

Railway Giants: He Started as a Pool Hall Cashier, Eventually Became an Influential Investor. Stilwell Followed God's Will
photo: Portrait of Arthur Stilwell / Wikimedia commons/Arthur Stilwell
26 / 02 / 2024

Arthur Stilwell is one of the key figures in the development of the American railroad. Read the story, full of unexpected twists and turns.

The year is 1859, and we are in the American city of Rochester, New York. It is here that Arthur Stilwell is born. He won't be in his hometown for long, as he convinces a family friend to employ him as a cashier at a billiard room in his hotel in St. Louis. But this is not a job that young Arthur wants to do for the long term. In a few years, he will find a job with Travelers' Insurance, for which he will work as a salesman. This change of career is not the result of an omnipotent coincidence, but rather the result of Arthur's father's bad investments, which led him into debt. Arthur therefore needed a job that would, if possible, provide him with enough money to at least partially repay his father's debts.

Hotel postaven Arthurem Stilwellem

Because of his skill, he works his way up to the position of national agent for his insurance company. Here he will earn a considerable amount of money not only to pay off his father's debts but above all to secure not only his own future. For he has been courting a girl named Jennie A. Wood for some time. These funds will enable him to secure their married life together.

Not long after, Arthur decides to pursue a career as an investor and so leaves his job at the insurance company. The question, however, is where to invest his money. Arthur decides on the railroad, which is quite logical. His start on the rails has already helped him build a bright career in the insurance industry, so why shouldn't he be able to make an investment career on the railroad again?

Railway Investor

Arthur starts to build the Kansas City Suburban Belt Railway. To connect Kansas City to the Gulf of Mexico by rail, he begins building and acquiring rail lines for the Kansas City, Pittsburg, and Gulf Railroad Company (later to become the Kansas City Southern Railroad), laying out land for towns along the way, including Mena, Arkansas; Stilwell, Oklahoma; Port Arthur, Texas; and many others. The move is perfectly logical. It is a historical rule that cities thrive most when they are near transportation routes. Moreover, the population in the US is growing, and there is no end to migration from Europe, Asia, and elsewhere, so there will be no shortage of residents.

Teno's move may prove brilliant in terms of the long-term flourishing of this swath of U.S. territory, but not so much from an investor's perspective. Fortune will be against Arthur this time. Setbacks, including lawsuits, a hurricane, and yellow fever, cause financial problems for the otherwise successful venture, and on April 1, 1899, Arthur's company, KCP&G, is thrown into receivership by one of its financiers. Few could have guessed at the time that in just two years, a giant oil field would be discovered in Texas, ensuring the railroad's future success.

The setback of losing control of the KCP&G, however, did not faze Arthur. Almost immediately, he announces plans to build a railroad that will connect Kansas City to the Pacific Ocean for a change. He forms the Kansas City, Mexico, and Orient Railway. Ironically, its fate is not much different from that of its older sister. Due to financial problems and the Mexican Revolution sparked in 1910, the company is forced into receivership in March 1912. Oil is discovered beneath its tracks, which enriches its manager, William T. Kemper.

A Time of Settlement

Arthur, however, has neither the desire nor the time for another attempt. He will retire in 1912 and devote himself to writing books. In them, he will, among other things, settle scores with his financial rivals. The highlight of these works will be the book "Cannibals of Finance", which attacks John Gates, Harriman, and Thalmann, the men who forced KCP&G (Kansas City Southern) into receivership.

Arthur Stilwell dies of apoplexy on September 26, 1928, in New York City at the age of 68. Less than two weeks later, his wife commits suicide. Dressed in her finest clothes, she jumps from the window of their 12th-floor Manhattan apartment. Ironically, the Stilwells leave behind an estate worth only $1,000. The Stilwells' cremated remains have never been found.

Thus ends the story of a man who contributed greatly to the development of the United States at the turn of the 19th and 20th centuries. Yet, in his own words, he had little to do with his work. He claimed that all his business plans were dictated by voices from the spirit world. His decision to run the railroad to what later became Port Arthur was said to be based on a prophetic warning that a tidal wave would hit the city of Galveston. Four years later, in 1900, the city was devastated by the most destructive hurricane in United States history.