Benjamin Bates IV

Benjamin Bates
Bates in 1857
Born	Benjamin Edward Bates (1808-07-12)July 12, 1808 Mansfield, Massachusetts, U.S.
Died	January 14, 1878(1878-01-14) (aged 69) Boston, Massachusetts
Occupation	Founder and former chairman of the Bates Mill Company Founder of the Lewiston Water Power Company Funded the establishment of Bates College Funded the establishment of the Church of the Covenant Founder of the Bates Manufacturing Company President of the Union Pacific Railroad
Net worth	US $79 million at the time of his death (equivalent to approximately $174 Billion 2016 dollars) (approximately 1/87th of US GNP)
Religion	Congregationalist
Relatives	See Bates family
Signature

Benjamin Edward Bates IV (/beɪtɛs/ BAY-ts;^[1] July 12, 1808 – January 14, 1878) was an American business magnate, and philanthropist. Known for his widespread business endeavors in New England during the 1840s, 1850s, and 1860s, he produced some of the most prominent academic institutions, buildings, and manufacturing sites in the United States. He belonged to the Bates family, a wealthy business family during the Gilded Age.

He was the founder of the Bates Manufacturing Company which housed the Bates Mill Company, which dominated the mill industry and was one of the first great U.S. business trusts.^[2] He initially gained wealth and influence from manufacturing textiles, estate development, and railroad construction. His business pursuits played a key role in integrating the early manifestations of the Efficiency Movement, and Taylorism in Maine. Bates would later go on to found the Lewiston Water Power Company in Lewiston, Maine, which built the first canal in the city. His influence and power in Maine and the greater New England area revolutionized the textile manufacturing market, and provided stabilization during the Manhattan banking panics of 1837. His businesses provided the capital for educational and industrial development in Maine, and at one point was the single largest employer in Lewiston, and per capita the largest in Maine, a distinction he held for three decades. During the American Civil War, he provided thousands of French-Canadians and Europeans with employment in his mills As historically the wealthiest person in the state during the 1800s,^[3] his fortune was mainly used to create a modern systematic approach of targeted philanthropy, including educational, academic, manufacturing, and banking investment.^[4] He is widely known for his role in the financing of Bates College in Lewiston, Maine, along with founder Oren Burbank Cheney and the construction of the tallest building in Boston at the time, the Church of the Covenant. His involvement in the college at the time of political unrest provided the college with financial stability in the financial panics of the 1870s.^[5]

Early life and education

Church of the Covenant, established with the funds of Bates

Benjamin Edward Bates IV, was born in Mansfield, Massachusetts on July 12, 1808, to Hannah Copeland and Elkanah Bates as their third child. His father, Elkanah Bates was a cotton manufacturer and prominent merchant.^[6] Both of his parents were religious and belonged to the Congregational Church of Mansfield. In 1838, the new denomination split from the church to create a theologian association that questioned the divinity of Christ, Elkanah Bates was picked to lead the movement. His paternal grandfather fought in the American Revolution as a Captain, and later became a brigadier general for the Massachusetts state militia.^[2] He is the great-great grandson of Benjamin Bates II, Commander of the Devonshire Forces, and member of the Hell Fire Club. When Bates was a younger boy, his brother recounts him being dragged by two horses across a "considerable distance" which left him badly cut and bruised, he pulled the horses down and eventually halted their movement, a considerable task considering Bates was only 14 years old at the time.^[7] Bates attended various private schools and enrolled at the age of 15 to the Wrentham Academy, and studied there from 1823 to 1825, before moving to Boston, Massachusetts in 1829, at age 21. Bates entered the dry goods business with Barnabas T. Loring on Washington Street. At age 24, he made a public profession of Christian faith, and he was a lifelong Congregationalist and temperance supporter. Bates taught Sunday school at several churches in Boston including Park Street Church and was later an active member of Central Congregational Church in Boston.^[8]

Business pursuits

B. T. Loring & Co.

Oren Burbank Cheney met Benjamin Bates in the early 1830s and the two became business partners. They met while Bates was a clerk for Barnabas T. Loring on Washington Street after a mutual friend offered "a firm with respected work."^[9] At the time with Bates' net worth was at $700, which was considered lower-middle class at the time. The firm subsequently organized as the B. T. Loring Company. The firm's market expanded widely throughout Maine and went on to depart from retail and focus on whole sale, which was made possible by the connections Bates had made throughout his career in Bristol, Maine. One year later, they moved "downtown" from Washington Street to Central Street, and continued operations. Barnabas T. Loring died prompting the group to dissolve B. T. Loring & Co., and create Davis, Bates, & Turner.^[10]

Workers in industrial Lewiston, in the late nineteenth century

Davis, Bates & Turner

With the conclusion of B. T. Loring & Co., Bates co-founded the firm of Davis, & Bates (later Davis, Bates & Turner), which existed from 1833 until 1847. The firm enjoyed financial success as its previous deals garnered high standing among the mercantile community of Maine. With the firm on stable footing, John N. Turner developed an interest and discussed furthered involvement. As a mutual friend of Bates, and his background in law, he was tasked with bookkeeping and legal relations. The firm amassed tens of thousands of dollars within years and the firm continued to grow.^[11] Turner was officially brought on on February 13, 1833, and the firm was officially renamed Davis, Bates & Turner.^[12]

Efficiency movement

Bates was known for his part in integrating the early manifestations of Taylorism in industrial Maine. His management style required high levels of managerial control and power over aggregated output which subsequently strained work practices. His firms were known for long work hours, poor working conditions and high output.^[13] He tended to his businesses "compulsively and incessantly" and often disregarded pressures to start a family, however did leave them with a considerable fortune at his death.^[14]

Manhattan panic of 1837

In 1837, the firm experienced low levels of revenue and output due to the external effects of panics involving financial security and credit in Manhattan. Considered the "greatest financial panic the country has ever seen", numerous firms all over New England failed and Davis, Bates & Turner, often had trouble assessing market value and withdrawing loans from the banks. The firm remained active and even put up positive net return on some years during the panic due to their good credit and lack of debt.^[15] Due to the overall speculative markets involving whole sale goods, Bates' firm remained cautious when selling and taking out loans for restructuring. News from New York was delivered to Maine stating further banking regulation and overall stabilization of market prices, which brought the state out of a recessive period into a sustained growth. The news was received by Bates personally when George Bond, declared that loans would be issued by the New York Banks once again.^[16]

Tompkins square riot in the 1870s, due to lack of credit stability of Manhattan banks

During the recovery consultations between Maine and Massachusetts business leaders, a prominent banker, Homer Bartlett was quoted as famously saying,

Who was the strongest man in that meeting [referring to the financial panics]?

To which the crowd overwhelmingly replied,

Benjamin Bates was the strongest man there.^[17]

This quote would go on to largely shape Bates' minor celebrity status and fed the growing reputation of producing the best results in times of uncertainty. The crowd included, Lyman Nichols, George L. Ward, Alexander De Witt, Francis Skinner, Homer Bartlett, and St. John Smith.^[18] In 1840, the firm moved to Water Street, and five years later moved to Milk Street, where Davis withdrew from the firm due to poor health.^[19]

Bates, Turner & Co.

Siles Bascom replaced Davis and the firm was renamed Bates, Turner & Co. The firm enjoyed financial success and began to conclude its practice with the closing of markets in 1847.^[20] After the dissolution of the firm, Bates served as president and on the board of several banking, manufacturing and railroad corporations, including First National Bank of Commerce in Boston and the Union Pacific Railroad.^[21]

Bates Manufacturing Company

His principle accomplishment during his early business career was the establishment of Bates Manufacturing Company. The company went on to be the largest manufacturing company in the state of Maine and provided two-thirds of all textile output for the state.^[13] It employed approximately five thousand people from Canadian and Irish descent.

Life in Lewiston

Alexander De Witt, advised Bates on development strategy in Lewiston

Bates travel to Lewiston regularly while living in Boston and other Maine towns, to "interact with the people, give guidance to the businesses, and support its economy."^[22] After the closing of Bates, Turner & Co., he moved to Lewiston, Maine upon the advisement of his close friend and confidant Alexander De Witt who went on describe Lewiston as a "city full of hope and innovation."^[23] He was escorted to the town secretly with De Witt, to meet with the city council and Mayor to discuss major developments in the town. Bates quickly began developing companies, acquiring smaller ones under his Manufacturing Company, and subsequently brought in sixteen million dollars in revenue for the town, the largest circulation of currency in the history of Lewiston at the time.^[24] His businesses provided employment for thousands of people from Maine and Canada, which made him the single largest employer in the city, and the largest per capita of Maine. His businesses garnered millions of dollars for the city and with all assets accounted for in Maine and Massachusetts, he was considered the wealthiest man in Maine via his net worth.^[25]

Lewiston Water Power Company

One of the primary goals of other business leaders in Maine and Bates was to improve the water quality of Lewiston. Bates went on to found the Lewiston Water Power Company, which built the first canal in the city. It employed hundreds of people and established the town as a "paragon of water quality." During this development Lewiston was the fastest growing city in Maine, in terms of growth rate.^[26]

Bates Mill

Bates Mill and Canal

Bates Mill was a textile factory company founded in 1850 and located at 35 Canal Street in Lewiston, Maine. Much of the capital generated from this mill was used in the foundation of Bates College. Since conception, Bates' practices with the mill dominated the mill industry and was one of the first great U.S. business trusts. He initially gained wealth and influence from manufacturing textiles and estate development with correspondence to the mills. His mills extended from the Androscoggin River to northern Lewiston.^[26] On August 16, 1850, Maine Governor John Hubbard signed the incorporation act and the mill was completed 1852. Bates positioned the mill in Lewiston due to the location of the Lewiston Falls which provided the mill with power. Under Bates’ supervision, during the Civil War, the mill produced textiles to the Union Army. His mills generated employment for thousands of Canadians, and immigrants from Europe. The mill was Maine's largest employer for three decade^[27]

Slave relations

Like numerous factories in Maine, Bates' mill was receiving cotton from the South, where it was grown and cultivated by slave labor. Correctly anticipating that the increasing talk of secession in the Southern States might eventually lead to a shortage of cotton, Bates bought an unprecedented amount of cotton prior to the outbreak of the Civil War. During the War, Bates was able to produce uniforms for the Union Army as well as other textiles. His efforts concluded numerous periodic shortages of textiles through the war to be quelled, he was dubbed, the "supplier of movement."^[28] His capitalization of this, saw to great levels of profit for his firms and companies, and caused dozens of mills to be closed due to overwhelming competition.^[2]

Railroads

Bates was the president and on the board of numerous railroad companies throughout Maine. His most famous position was his presidency of the Union Pacific Railroad, which at the time was the largest in Maine.^[21] He helped finance the construction of railroads all over Maine and manipulated courses to benefit the sale of his redistributed cotton, and textiles. He also supplemented the operational costs of his railroads by moving war material across the state.^[2]

Bates College

Initial donation

Bates College in 1857

Bates was the largest of the early donors to Bates College. He first made substantial donations to the school when it was known at the Maine State Seminary through the Lewiston Power Company. He was known by the people of Lewiston for having a "deep and profound love" for the town and the College.

Cheney, the founder of the college, mentioned his affection for the area noting,

I have frequently heard him say that he would not knowingly do anything against the interests of the people; and that he would sooner invest ten dollars in Lewiston than one dollar in any other place. 'I love Lewiston', 'I love the College', he was accustomed to say, 'Say to the Trustees that I love the College.'^[3]

In 1852, he personally pledged another $6,000 to the school. In 1853, Oren Burbank Cheney appointed him as a Trustee of the College and in 1854 subsequently became Chairman of the Board of Trustee of the college due to his considerable donations.^[29] He went onto donate $25,000 for the foundation of agriculture department and moved a subscription of $75,000 for campus expansion. On February 21, 1873, he donated $100,000 on the condition that the amount was met by third-party donors, within five years. Although he placed conditions on his donations, he realized his donations regardless of the conditions being met.^[24] Because of the Dartmouth v. United States, Supreme Court case Oren Cheney reinforced his belief that "a college can never pass into the hands of any other people or party without the consent of these churches or their proper representatives."^[3]

Establishment and development

The college remained a source of worry for Bates as much of the subscriptions to the college remained unfilled, donors were giving half of their donations and not fulfilling the other half, which left the endowment of the college in a speculative state. Bates served as the treasurer for the college in the early days and condemned the business strategy Cheney developed when interacting with potential donors.^[24]

Bates' work with the college prompted fellow business magnate, Andrew Carnegie, to donate a considerable amount to the formation of the college and subsequently had the college's science building named after him.^[30] Bates played an integral role in the expansion of the college, moving from town to town and state to state spreading the institutions name.

Oren Burbank Cheney

This brought in tens of thousands of dollars from the politically elite and wealthy who donated more on a favor to Bates than love of the college, as Bates had graduated little alumnus who went on to amass wealth.^[24]

By his death in 1878, Bates' donations to the College totalled over $100,000, and overall contributions valued at $250,000.^[24] Cheney renamed the College after Bates without his knowledge.

Bates wrote to Cheney and noted the naming of the college after him, saying:

In regard to the name of your college, I can only say that my choice would have been to name it after someone more worthy of its inception and history... I am sorry the Board of Trustees have renamed the college after me as I cannot raise so much money as people may think I am asking money for myself.^[24]

- May 18, 1863

Death and legacy

Economic panic of 1873

Bates pledged another $100,000 to be paid after his death, but due to the economic recession in the 1870s, known as the Panic of 1873, Bates' Lewiston assets was lessened. During this financial crisis many of his properties lessened in value and he was forced to refinance. Due to the dependence of Lewiston on Bates many citizens suffered financially in the personal losses of Bates. After the stabilization of his properties and business contracts he began a further expansion into Lewiston's economic environment, and regained considerable wealth. He built Bates Mill No.5 which became his fastest growing Mill within years and provided the city with substantial employment.^[24]

Wealth

By his death in 1878, Bates had amassed a total net worth of approximately $79.4 million (worth $174 billion in 2016). This includes assets held in Maine, New York, and Massachusetts that encompassed the non-operational value of B. T. Loring & Co., Bates, Turner & Co., his holding company the Bates Manufacturing Company, his stake in the Lewiston Water Company, Bates Mill, and miscellaneous banking endeavors in New York. He donated a total of $100,000 to the endowment, and approximately $250,000 to Bates College, indirectly and left a trust of $3.3 million to his family.^[2] In his will he pledged $50,000 to his wife Sarah Gilbert along with his 2.8 million dollar estate, $10,000 to his brother William, $10,000 to his brother Elkanah Bates II, $10,000 equally divided among the children of his sister, Charlotte, $10,000 to Edward Atkinson, and $10,000 to George Fabian. He left each of his children, Benjamin Edward V, Lilian, Sarah, and Author $250,000 in the form of a trust.^[31]

However, Bates had $200,000 in outstanding debt and a pledged $100,000 to Bates College after his death. His family was required expend the $100,000 pledged but due to conditions placed on the inheritances, restricted distribution, and familial debt, the Supreme Judicial Court of Massachusetts eventually ruled that Bates' heirs did not have to pay Bates College the pledged $100,000. After a period of recession the college began to financially recuperate to a larger endowment, independently. Over the next couple of years Bates College's endowment has grown slowly and steadily.

Death and aftermath

Bates' grave at the Mount Auburn Cemetery

He died in 1878 and is widely regarded as one of the most crucial members of the development of Maine and Bates College. Bates College is currently one of the top ranked colleges in the United States and is commonly referred to as a "Little Ivy". Benjamin Bates was buried at the Mount Auburn Cemetery on Fir Avenue.^[32] Many buildings, streets, and churches are named after him.

Bates College's inaugural president, Oren Burbank Cheney said the following of Bates delivering his eulogy:

…Mr. Bates wanted labor for our laborers, education for our children, places of worship for our worshipers, light for our streets, water for our houses, and a hospital for our sick and our dying. I have heard the man [Bates] speak of his love for Lewiston, and his love for the college. While in Lewiston, our desires were his desires: our interests were his interests: and our affairs his affairs...^[24][33]

His death was attended by Lewiston, Boston, and New York elite, and the Mayors of numerous cities gave speeches on his life. His funeral was held in the Lewiston City Hall, and clergymen gave speeches on his commitment to the college and God.^[34]

References

Citations

Extended notes

1. Oren Cheney, "Eulogy on the Life of Benjamin Edward Bates," Bates Student, June 1878, 131-149, (Muskie Archives and Special Collections Library, Bates College) (part 2).

External links

Wikimedia Commons has media related to Benjamin Edward Bates.

• Benjamin Bates Eulogy, pg. 131-149, Bates Student 1877-78 (part 2)

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