When Cornelius “Commodore” Vanderbilt died on January 4, 1877, he left the largest fortune anyone in America had ever assembled — roughly $100 million, a sum so vast it was said to exceed the cash then held in the entire United States Treasury. Built first on steamships and then on the consolidation of the New York Central and Hudson River railroads, it was the foundation of what looked like an unassailable dynasty. The Commodore, distrustful of his children’s competence, left about 95 percent of it — some $95 million — to a single son, William Henry Vanderbilt, in the deliberate belief that concentrating the capital would preserve it.
For one more generation, the strategy worked spectacularly. William Henry roughly doubled the fortune, to an estimated $194–200 million by the time of his own death in December 1885, briefly making him the richest man in the world and the only heir ever to increase the Vanderbilt fortune. But he broke from his father’s logic and divided the money widely among his eight children — and that third generation, raised to spend rather than to build, set about converting the greatest cash fortune in America into marble, art, yachts, and social rank.
The Vanderbilts of the Gilded Age built more grand houses than any family in American history: a row of palaces on Fifth Avenue, “The Breakers” and “Marble House” at Newport, the 250-room Biltmore in North Carolina — still the largest private home in the country. None of it generated income; all of it consumed capital, demanded armies of servants, and locked the family into a ruinous competition for social supremacy. The fortune was steadily spread thinner across more heirs and poured into assets that only ever cost money to keep.
Within about thirty years of the Commodore’s death no Vanderbilt was among the richest Americans, and the Fifth Avenue mansions were eventually torn down for commercial real estate. In his 1989 history Fortune’s Children: The Fall of the House of Vanderbilt, family member Arthur T. Vanderbilt II recorded that when 120 members of the family gathered for a reunion at Vanderbilt University in 1973, not one of them was a millionaire. It remains the textbook case of a dynasty that spent, rather than grew, what it inherited — the mirror image of Cornelius Vanderbilt’s self-made rise chronicled on our sister site, Up From Nothing.
Horace Austin Warner Tabor — “Haw” to the men of Leadville — was a Vermont-born stonecutter and shopkeeper who spent two decades scratching at the edges of one mining camp after another before a single grubstake made him, almost overnight, one of the richest men in America. In 1878 he staked two German prospectors who blundered into the Little Pittsburg, a fabulous silver lode; the following year he bought the Matchless Mine outright. By 1881 he was reckoned worth around nine million dollars — the equivalent of hundreds of millions today — and he spent it on the scale of a man who could not quite believe it would ever stop coming.
Tabor built opera houses in Leadville and Denver, raised the Tabor Block downtown, served as the first mayor of Leadville and as Colorado’s lieutenant governor, and bought a thirty-day seat in the United States Senate. He also divorced Augusta, the frugal wife who had endured the lean years with him, and married Elizabeth “Baby Doe” McCourt in a Washington wedding so lavish and so scandalous that respectable society never quite forgave either of them.
The fortune rested on a single commodity, and that commodity rested on a single act of Congress. The Sherman Silver Purchase Act of 1890 propped up the price of silver by obliging the Treasury to buy it; when the Panic of 1893 hit and President Grover Cleveland forced the Act’s repeal that autumn, the silver market collapsed. Tabor, leveraged and overextended, watched mine after mine and building after building slip away to his creditors within a matter of months.
He died in 1899, six years after the crash, having spent his last year as the postmaster of Denver — a patronage appointment arranged by friends who remembered what he had been. His widow Baby Doe kept her husband’s deathbed faith with the Matchless Mine, living in a cabin beside its played-out shaft until she was found frozen there in the winter of 1935. The Tabors became Colorado’s enduring parable of the silver age: the speed of the rise, the completeness of the fall, and the long cold coda no one could have written for them.
William Frederick “Buffalo Bill” Cody was, for a stretch of the late nineteenth century, plausibly the most famous human being on earth — a frontier scout turned showman who packaged the American West into a touring spectacle and sold it to millions of people across the United States and Europe. Buffalo Bill’s Wild West, founded in 1883, earned him several fortunes over three decades. He spent or lost every one of them, and died in 1917 effectively broke, his great show foreclosed and auctioned out from under him.
Cody made money the way few entertainers ever have, and he gave it away and gambled it away with equal abandon. He was famously, almost compulsively generous, handing cash to old friends, broke cowboys, and anyone with a hard-luck story. He was also a serial sucker for investment schemes wholly outside his expertise: an Arizona gold-and-tungsten mine that swallowed money for years, irrigation and land-development ventures in Wyoming, a hotel, ranches. The show kept refilling the well, and the schemes and the generosity kept draining it faster.
The two enterprises that defined his decline were a mine and a loan. The Campo Bonito mine near Oracle, Arizona, which he organized into a $600,000 company around 1910, never came close to paying back what he sank into it. And in January 1913, short of cash to keep his combined “Two Bills” show afloat, Cody borrowed twenty thousand dollars from Harry Tammen, a Denver Post owner and circus operator — a loan that, when Cody fell behind, gave Tammen the lever to seize and auction the entire Wild West show that July.
For his last years the most famous showman in the world was, in effect, an employee — performing for the very circus interests that had taken his show, unable to retire because he could not afford to. He died in Denver on January 10, 1917. By the most cited accounts his once-enormous earnings had dwindled to under a hundred thousand dollars in assets, much of it encumbered. Buffalo Bill is the classic case of the great earner undone not by a single crash but by a lifetime of bad bets and open-handedness that no income could outrun.
Ulysses S. Grant won the Civil War for the Union and served two terms as President of the United States, yet he spent the final year of his life racing against bankruptcy and a fatal cancer. After leaving office, the famously incorruptible general proved a disastrous judge of business partners, and in 1884 a Wall Street Ponzi scheme bearing his own name destroyed nearly everything he had.
The firm was Grant & Ward, a brokerage in which Grant invested alongside his son and the dazzling young financier Ferdinand Ward. Ward, hailed as the “Young Napoleon of Wall Street,” was in fact running a fraud, paying old investors with new investors’ money and inventing imaginary government contracts. When the scheme collapsed on May 6, 1884, Grant — who had put his savings and his name behind it — walked out of his office a pauper, reportedly left with about $80 to his name while his wife Julia had another $130.
Destitution arrived alongside disease. Later in 1884 Grant was diagnosed with throat cancer, almost certainly linked to his lifelong cigar smoking, and he understood he was dying with no estate to leave his wife. To provide for Julia and the family, the dying general undertook one last campaign: writing his “Personal Memoirs,” a two-volume account of his Civil War years, published through Mark Twain’s company on extraordinarily generous terms.
Grant laid down his pen on July 16, 1885, having written some 366,000 words in less than a year, and died on July 23, 1885, at Mount McGregor, New York. The memoirs became a publishing triumph — both a literary masterpiece and a financial one — ultimately earning roughly $450,000 in royalties for his widow. The man who had been ruined by a swindle saved his family with his own pen in the last weeks of his life.
William Magear Tweed — known to New York and to history as ‘Boss’ Tweed — rose from a volunteer fire company on the Lower East Side to become the most powerful man in the city, the master of the Tammany Hall Democratic machine, and the head of a ring of officials who looted the municipal treasury on a scale that has never been precisely measured. Contemporary estimates of what the ‘Tweed Ring’ stole between roughly 1865 and 1871 ranged from about $25 million to as much as $200 million; some modern historians, adjusting for inflation and the full sweep of the graft, have suggested figures running into the billions of dollars. Whatever the true number, it was enough to make Tweed, for a few years, one of the largest landowners in New York and a director of banks, a railroad, and a hotel.
The machinery of the theft was almost banal in its method and breathtaking in its volume. The Ring controlled the bodies that audited and paid the city’s bills, and they simply padded those bills — contractors and suppliers were instructed to inflate their charges enormously, kick most of the surplus back to the Ring, and keep a share for their silence. The new New York County Courthouse, begun in 1861, became the monument to the scheme: a building budgeted at a few hundred thousand dollars that swallowed many millions, with thermometers, plastering, and furniture billed at sums that defied belief.
Tweed’s undoing came not from the police or the courts, which he largely owned, but from the press. The cartoonist Thomas Nast pilloried him relentlessly in Harper’s Weekly, rendering the rotund Boss in images so vivid that even the illiterate could understand them — Tweed reportedly complained less about the articles than about ‘them damned pictures.’ In July 1871 The New York Times, supplied with figures leaked from inside the comptroller’s office, published the Ring’s own accounts, laying the fraud out in columns of numbers the public could verify.
The exposure destroyed him. Tweed was arrested, tried, and convicted; he escaped from custody and fled the country, only to be recaptured in Spain — where, by a famous irony, officials are said to have identified him from one of Nast’s cartoons. He was returned to New York and died, broke and broken, in the Ludlow Street Jail in April 1878, in the very institution his own machine had once controlled.