The Ezra Files: Chaos in the budding telegraph business

Always confident of a great commercial future for the telegraph, Ezra Cornell enthusiastically demonstrated it, enlisted capital and built lines. Although this work frequently left his family destitute, Cornell always took a large part of his pay in stocks and invested in the first telegraph company, which connected New York and Washington. He built lines from New York City to Philadelphia and to Albany, as well as lines in New York, Vermont and Quebec, and west to Buffalo, Cleveland, Detroit, Chicago and Milwaukee. He was involved in the rapid construction of subsidiary lines, especially in the Midwest, where the telegraph preceded rather than followed the railroad.

Yet, these early days of the telegraph industry were tumultuous and did not reap much revenue for Cornell. Many companies formed, operated briefly and died. Stronger companies managed to survive despite conflicts, deception and numerous lawsuits. Service on the hastily built lines was frequently unreliable.

Cornell's dismay with the business is evident in this Sept. 16, 1851, letter to telegraph business associate Amos Kendall:

"My courage is fast failing. I have worked hard and incessently for the last nine years at the Telegraph business, practicing the most rigid economy, and I am now worse off than when I began. At the time I first embarked in the business I was worth five thousand dollars in real estate which rented for enough to support my family. Now that same real estate is encumbered with a mortgage for money invested in the telegraph business and I am in debt some $15,000 besides for cost of construction of the various lines, and I cannot get the first cent from any of them toards paying interest on what I owe, aside from this is the various claims of patentees for account of patent.

"... My wife well knows my ability to support my family by labour if properly directed. She feels that I have followed the Telegraph quite long enough, and that it would be for our interest to abandon it in toto and all claims upon it, and direct my energies in some more productive channel.

"If I had been successful in the business I should not think of an appeal of this kind, but under the circumstances I think I have a claim to my devotion to the interest of Prof. Morse and his great invention entitles me to some concideration in the settlement of this question of patent. [sic]"

Adapted by Susan S. Lang from the Web site, "Invention and Enterprise: Ezra Cornell, a Nineteenth-Century Life."

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