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.
William Crapo Durant was one of the great empire-builders of the American automobile age — and one of its most complete financial casualties. Having already made a fortune in horse-drawn carriages, he founded General Motors on September 16, 1908, by bundling together a string of fledgling car and parts companies, and he later co-founded Chevrolet. At his peak in the 1920s his fortune was enormous — popularly estimated as high as nearly $1 billion at the height of the boom — and he was a titan of American industry.
Durant’s genius was promotion, expansion, and the audacious deal; his weakness was that the same restless, leveraged optimism that built his empires repeatedly cost him control of them. He was forced out of General Motors not once but twice — in 1910 by the bankers who refinanced his over-extended company, and again in 1920 when a postwar slump and his own stock-market commitments left him unable to hold on.
After losing GM the second time he launched Durant Motors and threw himself into the booming stock market of the late 1920s, trading and promoting shares on an enormous scale and on heavy margin. The 1929 crash destroyed him. The man who had built the world’s largest automaker saw his fortune wiped out, Durant Motors was liquidated in 1933, and in 1936 he filed for bankruptcy, listing assets of only a few hundred dollars against liabilities of roughly a million.
Durant spent his final years in Flint, Michigan — the city where his career had begun — running modest ventures including a bowling alley (the North Flint Recreation Center, opened 1940) and an attached drive-in restaurant, the Horseshoe Inn, which he promoted with the same enthusiasm he had once brought to building GM. A stroke in 1942 ended his plans to build a national chain, and he died on March 18, 1947, his bills reportedly covered by Alfred P. Sloan and the Chrysler family. He remains the archetype of the builder who could create vast wealth but never learned to hold it.
The Stroh Brewing Company was founded in Detroit in 1850 by Bernhard Stroh, a German immigrant, and grew over five generations into one of the largest brewers in the United States — and one of the largest private family fortunes the country had ever produced. At its 1980s peak the family was worth at least $700 million by Forbes’s reckoning, with the family name on the Forbes 400 and Stroh’s the third-largest brewing empire in America, behind only Anheuser-Busch and Miller.
Then, in the space of roughly two decades, it all came apart. A debt-fueled gamble to go national — above all the 1982 takeover of the failing Joseph Schlitz Brewing Company, financed with hundreds of millions in borrowed money — left the company saddled with debt just as the industry consolidated around two giants. Stroh’s missed the light-beer wave, lost market share year after year, and could never out-earn its interest payments.
By February 1999 the family was selling the 149-year-old brewery for parts, its brands divided between Pabst and Miller. The proceeds went largely to debt and pension obligations; what trickled to the family through trusts ran out within a few years. Forbes later estimated that, had the family simply sold the business at its peak and invested in the S&P 500, the fortune could have been worth roughly $9 billion by 2014. Instead it was essentially gone.
The Stroh story has become a textbook case of generational wealth destruction — the old proverb of “shirtsleeves to shirtsleeves in three generations,” here stretched across five or six. It was not a swindle or a market crash but a slow, self-inflicted unwinding: a strategic bet too big for the balance sheet, made in a brutally consolidating industry, by a family that gambled a profitable status quo on becoming a national champion and lost.