In the 1880s New York got wired for sound and light, and the whirlwind rise of the electrical industry, and its equally rapid consolidation by New York financiers, was a telling sign of the times. It was probably inevitable, in the absence of government funding, that electrification, the largest industrial investment in the nation’s history, would be pioneered in the metropolis. Wall Street’s capital pools were here. So were the new corporations, who swiftly realized that electric power worked synergistically with tall towers and rapid transit to increase the velocity and efficiency of business operations. Manhattan also had a well-established tradition of innovation. Its interlocking commercial and civic cultures had nurtured Fulton’s steamboat and Morse’s telegraph into fruitful life, and now, in the corporate-professional postwar decades, a diverse mix of financiers, engineers, workers, lawyers, and publicists stood equally ready to promote scientific experimentation and harvest its most profitable applications. The city’s cosmopolitan openness to new ways of doing things, moreover, guaranteed a swift embrace of electric opportunities by leading economic, social, and cultural actors. Son et lumière would thus transform everyday urban life at the same time it strengthened the emerging corporate order and New York’s claim to be its capital.
In the early 1870s Western Union, the New York-based communications giant, was having technical difficulties. It had solidified its grip on the country’s telegraphic system, crushed efforts to create a government-run service, and, in alliance with the Associated Press, come to dominate the flow of information to the nation’s newspapers. But success had generated a staggering increase in the volume of messages, clogging the system. As a result, many telegraphers—the cantankerous, tobacco-chewing, hard-drinking, iconoclastic, peripatetic, and poorly paid men who worked the wires in stations across the country—had taken to spending their off-hours trying to strike it rich by inventing a “duplex,” a device to send two messages over the same wire at the same time.
Thomas Alva Edison was one of the tinkering telegraphers. He had displayed a bent for experimentation as a child in rural Ohio and developed a rudimentary mastery of mechanics and electricity in his years of wandering from one midwestern post to another. In the late 1860s, having been fired repeatedly for tying up lines for his research or alienating workmates with crude practical jokes, Edison was living in Boston, working on a duplex. He made ends meet by traveling to New York City, buying up stock tickers (just recently invented), and reselling and installing them for Boston financial firms. Beginning in 1869 he spent more and more time in New York, working on improving the ticker. He soon devised Edison’s Universal Printer, which was snapped up by Wall Street companies, becoming another of the technological struts supporting Manhattan’s financial preeminence.
In the summer of 1870 Edison ran across Daniel H. Craig, a bitter enemy of Western Union, who hired Edison to invent a way to automate telegraphic transmission. Funded by Philadelphia financiers eager to undercut the giant Manhattan firm, Craig set up the long-impoverished Edison in a large workshop in Newark, stocked with the finest machines and tools. Together with a draftsman, a machinist, and some theory picked up in a course at Cooper Union, Edison created a working duplex, then began designing a quadruplex that would allow one line to do the work of four.
News of this invention factory reached Western Union, then under Vanderbilt control. The firm summoned the twenty-four-year-old to company headquarters and proposed to help him perfect his device and let him test his models on Western Union lines. When Edison succeeded, however, the Vanderbilts refused his asking price for the rights. Aware that his Philadelphia backers had been weakened by the Panic of 1873, they figured the inventor would come to terms. They were right: with his debts mounting, Edison gravitated, as he always would, to where the money was that would fund his experiments and sustain his household, and in the crunch, the money proved to be in New York, not Philadelphia.
Edison moved from Newark twelve miles south to the farming village of Menlo Park, remote yet easily accessible to Manhattan (it stood three hundred yards from the railroad station). Here he established the first significant industrial research laboratory in the United States. Edison now spewed out inventions—cooking up plans, and sometimes models, for electric pens, dental drills, and fax machines. Occasionally he would break for a weekend jaunt to New York, dining with his wife at Delmonico’s and spending the night at the Astor House, or carousing with cronies at music halls and theaters, losing himself in the Bowery’s nighttime throng.
In early 1877, in Boston, Alexander Graham Bell transmitted vocal sounds—conversation itself—over the long lines. Bell exhibited the instrument in New York, giving lecture-demonstrations at Chickering Hall. Western Union assigned Edison to producing an improved apparatus, which they hoped would be distinctive enough to ward off patent infringement suits. Edison came up with a receiver that could amplify sounds more loudly. He arranged a long distance concert and had piano selections wired in from Philadelphia to a huge audience, including Professor Bell, jammed into Steinway Hall. By December the device was in production by the new American Speaking Telegraph Company, hustled into existence by Western Union investors, and Edison, at thirty-three, was one of the richest men in the country. But Western Union lost the ensuing legal and technological war and, threatened on its flank by Jay Gould, agreed to stay out of telephony if the Bell forces would stay out of telegraphy. Local telephone service therefore came to the metropolis under the corporate aegis of the Boston-based American Bell Corporation.
In May 1878 American Bell licensed a Metropolitan Telephone and Telegraph Company to commence service in an area thirty-three miles in all directions from City Hall. In March 1879 subscribers—who paid sixty dollars a year, soon upped to $150—were linked together by New York’s first telephone “exchange,” at 82 Nassau Street, and listed in the first directory, a small card listing 252 names. To reach a subscriber users turned a crank, lifted the earpiece, and asked the “operator” to connect them. At first, following the telegraph industry model, young men were used as operators, but their rowdy switching-room behavior—they drank beer, fought, and swore at customers—proved ill adapted to an industry that still had to seduce clients away from telegraphy. Native-born white women came presocialized with the proper decorum, and the new “Hello Girls” proved successful at soothing irate customers (equipment and connections being frustratingly unreliable). Many clients came to consider “Information” operators like Miss Katherine M. Schmitt, who joined the company in 1882, as being what she described as a “combination of personal-service bureau and general guide to the city of New York.” Schmitt routinely fielded queries such as “Where is the fire?” “Did anyone call me while I was out?” and “How do I get to Central Park?”
The Cortlandt Street Board of the New York Telephone Company, 1894, by which time women “operators” were the norm. Observed a writer in the Metropolitan Magazine: “It may seem, to one visiting the operating room of a telephone exchange, that the girls appear uncomfortably like prisoners. The galley-slave of old, bound to his oar by chains, was not held closer to his work than these, with their curious headgear of steel bands and black auricles, and the short stretch of wire which holds them, literally by the head, at their places in front of the switchboard.” (General Research. The New York Public Library. Astor, Lenox and Tilden Foundations)
By the mid-1890s there were twelve exchanges, each of which averaged 150,000 calls a day. Residential subscribers accounted for only 10 percent of this traffic, however, as household phones were far too expensive for most people (service was available at banks and drugstores). Only after the Bell patents expired in 1894, and independent companies rushed in, would phone service become more accessible.
Businesses, however, leapt to install the new instruments, with banks, brokers, professionals, the Stock Exchange, dry-goods firms, publishers, jewelers, and druggists leading the way. Phones promoted internal organizational coherence as well as communication with the outside world. Bankers and brokers scattered them through their offices. Department stores put instruments at sales counters. Factories installed them to keep the main office in touch with shop foremen. Engineers ran vertical wires along rising skyscrapers to allow contractors below to confer with foremen aloft. Once a tall tower was built, moreover, telephones eliminated the need for messengers to be endlessly riding up and down elevators to deliver telegrams. This helped make upper-story offices as profitable as ones nearer the ground. After long distance service arrived—New York was connected to Boston in 1884, Philadelphia in 1885, and Chicago in 1892—it also became easier for corporations headquartered in Manhattan to direct their far-flung operations.
Telephones were also deployed to help guard the central business district itself. In 1880 Chief Inspector Thomas Byrnes, head of the police department’s detective bureau, established a protective cordon around the Wall Street community, declaring Fulton Street a “Dead Line” south of which criminals (of the blue-collar variety) would not be tolerated. Using the new telephone, he connected Mulberry Street Headquarters to every station house. More conventionally, Byrnes saturated the financial district with police and maintained an elaborate system of underworld informants. Grateful businessmen like Jay Gould dispensed market tips, helping Byrnes accumulate a fortune of $350,000 on an annual salary of two thousand.
While New Yorkers were adopting the telephone, Edison was making other breakthroughs in sound, including a machine that could register and print voice patterns. By December 1877 his apparatus repeated words spoken into it in a faint metallic tone. With Barnumesque attention to publicity, he took the machine—the sound writer or “phonograph”—to the Manhattan offices of Scientific American. As one astonished participant recalled, Edison “turned a crank, and the machine inquired as to our health, asked how we liked the phonograph, informed us that it was very well, and bid us a cordial good night.” On January 2, 1878, the machine went on display at the Western Union building. People came, heard, and were convinced.
Edison brimmed over with moneymaking ideas for the phonograph. He licensed two Brooklyn men to incorporate it into clocks and watches that would call out the time, wake people up, and emit advertising messages. He groped toward stereo by working up a two-sided disk, both sides of which could be played simultaneously. He aimed to marketan educational toy phonograph that would help children learn the alphabet. And to promote the new machine in the most colossal manner possible, Edison proposed that when the Statue of Liberty finally rose on Bedloe’s Island, a phonograph be put in its mouth so that it could talk and whistle to ships passing by in the harbor.
In 1879 New York’s Common Council decided to experiment with arc lighting. Back in 1808 Humphrey Davy had discovered that when an electric current arced across the space between two carbon electrodes, it heated the carbon points to white heat, giving off a powerful incandescent light. For many decades this “arc light” found only intermittent uses, as carbons burned up rapidly and batteries were prohibitively expensive. By the 1870s, however, the development of electric generators had reduced the cost of power and a device had been invented to automatically replace burned out rods. Arc lights were now deployed here and there in Europe—St. Petersburg’s Winter Palace and Nevski Drive; Paris’s Place de la Concorde and Arc de Triomphe—and even more so in the United States, where Charles F. Brush’s company erected huge “sun towers” in several western cities. The towers were cheaper to install than hundreds of lampposts, and it was believed that the carpet of illumination they spread equally through all parts of town was somehow a more democratic, more American light.
New York City’s Gas Commission authorized the Brush Electric Light Company to set up a generating station at 25th Street, consisting of two Corliss steam engines and two dynamo-electric generators. These would power a series of arc lights along Broadway. Each was mounted on a twenty-foot-tall ornamental cast-iron post, one per block, between the lower end of Union Square, opposite Delmonico’s, and Madison Square. On December 20, 1880, the boulevard was bathed in brilliant light—a Broadway show that garnered rave reviews.
The Brush Electric lights on Broadway, near Madison Square. This view looks south across 23rd Street, with Fifth Avenue on the right. The clock tower, which stood outside the Fifth Avenue Hotel, remains to this day. (© Collection of The New-York Historical Society)
During 1881 the city commissioned lights for Fifth Avenue and the crosstown streets of 14th and 34th. In addition it tried out “sun towers” in Union and Madison squares—160-foot masts topped with clusters of arc lights. The system was far from perfect, and storms often triggered power failures, but progress in driving back the darkness seemed evident.
Over the next few years, electric arc illumination spread along selected streets. By 1886 fifteen hundred lamps were in operation on Fourth, Fifth, and Seventh avenues, between the Battery and 59th Street, and up the thoroughfares flanking Central Park. Brush Electric Light (and soon its rivals) also began stringing wires on street poles and delivering power to illuminate industrial and commercial spaces: factories, railroad stations, building construction sites, Gansevoort Market Square, wharves, and the lobbies of hotels, theaters, office buildings, and department stores. The brilliant lights offered security for a burgeoning nightlife and drew vast numbers of visitors to commercial establishments.
At first there was no equivalent change in domestic lighting, even though by the 1870s gas light was rapidly falling from public favor. Once celebrated as a clean energy source, it now seemed impure, dirty, unhygienic. Gas jets produced headaches by eating oxygen and giving off ammonia, sulphur, and carbon dioxide, and they blackened ceilings and wrecked parlors with their soot. But arc lights were too dazzling for domestic use. Gas light was measured in the dozens of candlepower, arc light in the thousands. Unlike gas, moreover, an arc’s intensity could not be varied, and though they didn’t use up oxygen, their carbons gave off noxious fumes as they burned.
In 1878 Thomas Edison announced to the press that New York’s interiors would not be left in flickering half-light much longer. He intended to develop an incandescent lamp—not “a large light or blinding light, but a small light having the mildness of gas.” On the strength of this pronouncement, the Vanderbilts, heavy investors in the gas business, decided it was time to switch horses. They offered to form a company that would help Edison develop his ideas. The inventor, now canny in the ways of Wall Street, retained a high-powered corporate attorney, and a deal was hammered out.
A consortium of capitalists set up the Edison Electric Light Company to issue three hundred thousand dollars in stock, of which Edison would hold $250,000. The businessmen put up fifty thousand in cash to get him started experimenting. The twelve-member board of directors included Vanderbilt representatives, Western Union delegates, and J. P. Morgan himself (Drexel, Morgan would be the company’s banker). Henry Villard, flamboyant railroad financier, invested in the firm and urged his German banker connections to do likewise. In Vienna, Baron Rothschild got wind of events and sent August Belmont out to Menlo Park to investigate. Morgan himself crossed the Hudson to negotiate a deal for lighting Great Britain and Europe. And all this before Edison had generated much more than brash and unsupported promises.
Edison, supremely confident, spent a hefty portion of his advance money erecting a greatly expanded workshop, as well as an elegant library, with plush leather furniture, in which to greet visiting plutocrats from New York. Then he set to work, and in December 1879, syndicate members were invited out to a demonstration of what Edison had wrought. As the financiers watched in awe, globes decorated with flowers and papier-mâché glowed evenly and steadily, with the intensity of a gas jet, roughly twenty-five watts of luminosity.
During the following year, Edison prepared for the electrification of New York City. He laid out in the Menlo Park fields a grand mockup grid of Manhattan’s streets, replete with four hundred of the new lights. After a test performance in December 1880, to which he invited an enthralled Sarah Bernhardt, Edison was ready for New York’s officialdom. He gave a gala demonstration to assorted aldermen and commissioners, followed by a Delmonico-catered feast, at which he explained his intention to install subterranean electric wires in the square mile stretching from Wall Street to Canal. The assembled worthies gave Edison three hip-hip-hurrahs and, two weeks later, permission to lay his power mains.
Edison now transferred operations to Manhattan, taking over a four-story brownstone on lower Fifth Avenue near 14th Street. He illuminated it with a hundred globes, making it the first building in New York lighted exclusively by electricity and an irresistible nighttime beacon for residents. He also dismantled the Menlo Park machine shop and relocated it at Roach’s ironworks. To house the power station, he purchased two old buildings at 255-57 Pearl Street, near the Fulton Fish Market, though he professed to be flabbergasted at the $155,000 asking price for what he considered “the worst dilapidated street there was.”
With expenses soaring, financiers complaining, and rivals emerging, Edison reduced his target area to the fifty square blocks encompassed by Spruce, Nassau, Wall, and the East River—a territory that contained New York’s key financial, commercial, and manufacturing establishments and backed up on City Hall and Printing House Square. Throughout the summer, from eight at night until four in the morning, his men dug fifteen miles of trenches, laid the massive, solid copper power mains, and insulated them with a mix of Trinidad asphalt, linseed oil, paraffin, and beeswax. By fall new, improved, twenty-seven-ton generators, named “Jumbos” after Barnum’s giant elephant, were in place at the Pearl Street Station.
Finally, on September 4, 1882, the dynamos fed power—“direct current”—into the system. Eight hundred lamps winked on in two score locations, including the New York Times and the Drexel, Morgan building, where Edison himself, sporting a new Prince Albert coat, presided over the epochal event.
The first private house in the city to convert entirely to incandescent lighting was J. P. Morgan’s Madison Avenue mansion. Despite an explosive mishap that scorched the walls and carpets, the banker professed great pleasure; less so his neighbors, annoyed by the clanking of the generator installed in his garden. The Vanderbilts wired all three of their uptown palaces, though William H. backslid to gas after some mechanical disruptions. Within a year over five hundred wealthy homes were electrified: New York’s bourgeoisie now glowed in the dark with new intensity.
Houses of commerce switched to electricity with dispatch. The New York Stock Exchange installed three “electroliers” of sixty-six lamps each above the main trading floor. Scant steps away, at Broad and Exchange Place, the new nine-and-a-half-story Mills Building (1883) became the first office building in the city, and likely in the world, to have its own electric generation plant: it powered the 5,588 lights in quarters rented by bankers, brokers, and railroad and insurance companies and in the top-floor restaurant. In 1889 the first electric elevators began gliding up and down, and by the following year they were being purchased in lieu of hydraulic models. The first escalator would follow a decade later.
Industry lit up too. Machine shops, piano factories, sugar refineries, and newspaper plants went incandescent. Edison talked eagerly about converting 240,000 sewing machines to electricity: “In the tenement-house districts our business will be simply enormous,” he enthused. Manufacturers and financiers—the sorts who joined Edison in becoming members at the new and exclusive Electric Club (1886)—boasted that direct current would make it possible to significantly lengthen the working day, a prospect not greeted with universal acclaim.
What did delight almost everyone was the electrification of nightlife. Department stores shifted from gas to bulbs in the late 1880s. Freed from fear of fire, their window displays now shimmered in the night air, lending new glamour to commodities, providing virtual theaters for audiences passing by. Actual theaters seized on Edison’s lights too. In 1883 Niblo’s Garden featured “novel lighting effects by the Edison Electric Light Company,” including an illuminated model of the new Brooklyn Bridge and chorus girls who flourished electric wands.
The lady in the harbor went electric too. In 1886, when the Statue of Liberty was officially dedicated, its hand was brilliantly illuminated—too much so for mariners, and it had to be toned down—and its base was garlanded with eight-thousand-candlepower lamps. On a more domestic note, a New York Edison vice-president lit up his Christmas tree with incandescent colored globes, creating an instant popular sensation.
Hotels, restaurants, cafes, and shops—all beckoned customers with their radiance. Even shady places opted for the spotlight: Edison personally installed electric lights at Harry Hill’s, and the enterprising “French Madame” screwed bulbs into sockets on her doorstep. Illumination spilled down from the elevateds, which lit up their station platforms. It shone in from luminous Hudson River steamers and the yachts of the Bennetts and Goulds. Electric nights drew throngs of festive boulevardiers to the streets, linking its big-city image indelibly to the bright lights of its avenues. This identification was fixed forevermore with the emergence, in the mid-1890s, of what people began calling the “Great White Way”—a stretch of Broadway between 23rd and 34th streets that began to blaze with electric advertisements. The first large illuminated sign—a fifty-foot-high and eighty-foot-wide display at Madison Square—used fifteen thousand lights, which winked on and off in a sequence controlled by an operator in a shanty on a nearby roof, to trumpet Coney Island hostelries. It was soon superseded by a forty-five-foot-long Heinz (“57 Varieties”) pickle, outlined in bright green bulbs against an orange background, easily visible a mile away.
In 1887 Mayor Hewitt declared that nocturnal effulgence had become essential for the “prevention of crime” and the preservation of “the good order of the city.” So quickly had New York grown accustomed to electric street lights that whenever they went off in substantial numbers, extra police were ordered out as a matter of course.
The alacrity with which New York adopted the new technology did have its drawbacks. Most notably it generated a vast and proliferating network of wires that threatened to bury Manhattan. Western Union, Bell Telephone, the Gold and Stock Ticker Company, the Brush, United States, and East River Electrical Lighting companies, the fire department, police department, and private burglarproofing companies who installed alarm systems—all these strung their power lines on poles or across rooftops. As firms rarely deigned to share space, the streets were soon festooned with posts, each between fifty and ninety feet tall, each carrying a dozen to two score crosstrees, each crosstree bearing perhaps twenty wires. Some poles groaned with the weight of two hundred strands.
Increasing numbers of these snapped, dropping writhing live wires to the street below. In 1884 the legislature, impressed by the success of Edison’s underground operations, insisted that all other electrical supply systems be buried as well. The telephone, telegraph, and lighting companies ignored the order. Four years later, the blizzard of 1888 deposited twenty-two inches of snow on the streets and coated the wires with ice, sending them crashing down, terrifying the city. Mayor Grant led an ax-and-nipper patrol around town, slashing at the wire tentacles, but the Brush Company threatened to leave the city, and Jay Gould, now Western Union’s chieftain, got an injunction.
The public’s growing anxiety was heightened by Edison’s war against George Westinghouse, who was promoting “alternating current.” This rival system could be used to transmit power at high voltage from generating stations sited near waterfalls or dams hundreds of miles away, bypassing Edison’s entire patented system of direct current stations, which had to be located near their customers. Edison issued shrill warnings about the danger of high voltage lines, and, in the fall of 1887, when the state legislature asked for his help in inventing a more humane method of execution, he set aside his opposition to capital punishment and arranged some public demonstrations with test animals—using alternating current. When a competition was held to name the method, candidates included “electromort” and “electricide” (Edison held out for “Westinghoused”) but in August 1890 a convicted murderer was “electrocuted” for the first time, a bungled job that produced an “awful spectacle.” “They could have done it better with an axe,” Westinghouse said.
In response to the huge demand for telephones and electricity during the 1880s, a forest of utility poles sprang up along the streets of downtown Manhattan. (Consolidated Edison)
In October 1889 a Western Union lineman had been electrocuted on a wire gridiron in the heart of the business district. Thousands watched as the body dangled from overhead lines for nearly an hour, its mouth spitting blue flame. The next day the mayor ordered unsafe wires chopped down. It took another two months for incensed public uproar to overcome corporate legal stonewalling, but finally the poles began to fall. By 1894 there would still be lots to bury, but New York’s Board of Electrical Control announced that millions of feet of wire had been banished belowground and that Manhattan now possessed a sixteen-hundred-mile-long electrical arterial system from which 6,790 arc lamps, 268,000 incandescent lamps, and nearly ten thousand telephones drew sustenance.
While working on the electric light, Edison, aware that his generator run in reverse could serve as a motor, took a break from his primary experiments, purchased some secondhand horsecar tracks, and built a model roadbed one-third of a mile long. Then he mounted a twelve-horsepower dynamo on a truck, installed brushes on the wheels to pick up current from the rails, and on May 13, 1879, gleefully rolled along at twenty miles per hour in a horsecar filled with twenty passengers. Railroad companies clamored for Edison to develop his invention, and the president of the Long Island Rail Road offered tracks for testing, but though Edison did work now and then on an electric locomotive, there just weren’t enough hours in the day.
It was Frank Sprague, an academically trained electrical engineer who’d worked for Edison then struck out on his own, who invented a superior motor and installed it successfully in Richmond, Virginia. In the late 1880s Sprague electrified New York’s Fourth Avenue street railway line between the post office and 86th Street. In the 1890s, driven by competition, first the Third Avenue line and then the Metropolitan Street Railway Company began the enormously expensive process of switching their motive power. The Manhattan Company, however, under Gould, Sage, and Morgan, refused to follow suit. Sprague had successfully tested a system for electrifying New York’s elevateds back in 1886, but the complacent monopoly proved no more willing to invest in installing the requisite six-hundred-volt third rail than they were in relieving crowding. The Manhattan would stick with steam into the next century, nearly a decade after Chicago had junked its heavy and dirty steam engines.
Brooklynites’ problem was not corporate recalcitrance but excessive zeal. Brooklyn streetcar companies, not hampered by Manhattanites’ abhorrence of high wires, strung power lines above their tracks. The first conversions were completed in 1890, and within five years trolleys had almost completely replaced horsecars throughout the city, an extremely mixed blessing. Horsecars clopped along at six miles per hour. Electric cars could hurtle through streets at a terrifying thirty miles per hour, carrying three times the number of passengers, but though they had the weight and power of locomotives, their brakes were still those of a horsecar. Worse, companies set out to maximize profits by increasing the number of trips required for drivers to earn their daily wage, forcing them to careen through streets at near maximum speed. The result was carnage. By 1895 trolleys had killed 105 and maimed 407, most of them children, and become a symbol of random death. Calls for the municipalization of transit companies would grow steadily.
There were calls as well for the municipalization of the power supply. Once bourgeois neighborhoods and homes were wired, street and domestic lighting in Manhattan diffused at glacial pace because electric lighting was treated as a commodity, not (as in some European cities) a subsidized public service. Poor streets and outlying areas like Harlem would remain gas-lit until well into the twentieth century, and a blend (in William Dean Howells’s words) of “the moony sheen of the electrics mixing with the reddish points and blots of gas” would long characterize the Manhattan nightscape. Working people couldn’t afford electricity in their houses—a bulb alone cost a dollar, half a day laborer’s wages—or gas either: kerosene lamps remained their mainstay for illumination, and kerosene or coal stoves served for cooking and heating.
Gas itself grew more expensive as the industry grew less competitive. During the 1880s Manhattan’s many gas companies, panic stricken at the arrival of electricity, moved to conglomerate their operations. Primacy of place was seized by the Consolidated Gas Company (1884), a holding company organized by H. H. Rogers of Standard Oil, with backing from William Rockefeller and National City Bank. Consolidated Gas gained sufficient complete control of the marketplace to jack up prices— 25 percent in 1885 alone—and deliver poorer quality gas, while paying high dividends on wildly overcapitalized stock. William Rockefeller also gained a power base in Brooklyn’s gas industry, and once again the price went up and the product declined.
Substantial gas users such as hotel owners grew increasingly restive at the steady monopolization of the industry. Establishing a Gas Consumers Association, they called for the state legislature to investigate the situation; the resulting report denounced rampant stock watering and excessive profit-taking. In 1886 the state passed a bill lowering the maximum price from $1.75 to $1.25 per thousand cubic feet, though a reputed seventy thousand dollars in gas company bribes spread around Albany warded off threats to Consolidated itself. Gasmen proved unable to freeze out powerful new competitors, however. In 1894 the New York and East River Gas Company (1893) built a tunnel under the East River from Long Island City, permitting delivery of Ravenswood gas to Manhattan, and both Russell Sage and J. P. Morgan weighed in with new companies. Outfits like these exerted sufficient pressure to lower prices enough to satisfy big users, and the issue of gas reform was taken off the table.
Morgan achieved a clearer preeminence in electricity than the Rockefellers did in gas. In May 1889 Henry Villard set about consolidating Edison’s various American properties into a new Edison General Electric Company, capitalized at twelve million dollars. The initial stock offering, handled by Drexel, Morgan, was parceled out among various German and American banking concerns, and Morgan became the major investor in his own right. The merger provided Thomas Edison with enormous sums to run his laboratory—and to improve his living standard: he leased a Gramercy Park mansion, bought a yacht, and expanded both his investment portfolio and waistline.
In 1890 Edison General president Henry Villard set out to end what he considered the “ruinous competition” between his company and the other major players in the new electric universe. Villard first worked out a price-fixing agreement, but it was nullified by the Sherman Anti-Trust Act. He then tried to persuade Edison to merge with his enemies, but Edison objected that “no competition means no invention.” Events were no longer in the Wizard’s control, however. Morgan arranged a grand consolidation that in November 1892 pulled rivals together into General Electric, more popularly if less affectionately known as the Electric Trust. A scant fourteen years after Edison had invented a practical electric light, General Electric and Westinghouse between them had swallowed all competitors and controlled the market in generating equipment, transformers, meters, motors, and lighting apparatus. Edison, distraught at his loss of control and the obliteration of his name, announced he would “not be held responsible for the acts of an organization in which my voice is but one amongst a great many.”
Capital-intensive electrification helped make the old republican competitive free enterprise order seem hopelessly inefficient and quixotic, as the AC-supplied electric grid made feasible ever bigger generating stations for the centralized supply of power. The financial grid would make entrepreneurial autonomy seem equally outmoded and facilitate the concentration of economic power in a handful of centralized financial institutions.
Electrification-cum-corporatization would also force the issue of how vital city services were to be delivered onto the metropolitan agenda. Should energy provision remain in private and largely unregulated hands, to be distributed to citizens on the basis of their ability to pay? Or should the city and state again become more active agents in the production and distribution of social goods, the model New York had followed in the development of its water and canal systems? And if so, would countering private corporate power perhaps require the metropolitan area to construct a civic grid, connecting the various independent political constituencies scattered around the harbor? These were murky issues, and it would take more than an Edison to illuminate them.