The founding of Birmingham full of drama and paradox
A prominent Alabama historian called the period leading up to 1871 and the founding of Birmingham as “intrigue and cunning” and “a lot of complicity and double dealing.”
Another concluded that by documenting the battle over railroads and access to untapped mineral wealth in then sparsely populated Jefferson County: “Who deceived and overtook who may never be known.”
The setting for the founding of Birmingham was set some 500 million years ago. It was then that the geological processes began that resulted in the region’s vast deposits of iron ore, coal and limestone – the only place in the world where the three ingredients of iron are found so close .
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Interest in the profit potential of these resources – extracting them from the earth, transporting them from mine and quarry to factory, turning them into products for a growing country – emerged in the late 1850s. The Civil War ensued, but in the years that followed what would become the Birmingham Mineral District gained more and more attention.
For some, the best way to achieve these ambitions was to build a new city, the first heavy manufacturing center in the South. A group of influential Alabama landowners and financiers, which included John T. Milner and James W. Sloss, are widely recognized as having the most responsibility for making the Birmingham vision a reality. They were men of sensibility and sympathy from the Old South, but with a common understanding of the new economic realities of postwar America. Most, if not all, held slaves before the Civil War, and all had supported Confederation
Others – especially a group determined to become a major railway hub and trading hub – were absolutely opposed to founding a rival town to the south and only wanted to control the mineral wealth of Jefferson County. This group was led by John C. Stanton, a Massachusetts carpet collector described by a contemporary writer as “a red-haired rascal in a hurry.” Stanton was the driving force behind the development of the Alabama & Chattanooga Railroad, a 295 mile route from Chattanooga to Meridian, Mississippi, crossing Jefferson County.
The competition between these two groups has turned into a desperate rivalry. The result revolved around two questions: Where in Jones Valley would Stanton’s Alabama & Chattanooga cross the other railroad being built through Jefferson County, Alabama South & North, connecting the state capital of Montgomery to the river port of Decatur? And who would own the land around the intersection?
The first blow came from Chattanooga.
Through a series of maneuvers during the summer and early fall of 1868, Stanton succeeded in what amounted to a hostile takeover of the South and the North. He arranged for the chairman of the rival Railroad to be replaced by his own man, John Whiting, a Montgomery cotton planter and merchant with close ties to Wall Street financiers supporting Stanton’s plan. Whiting was quick to change the planned route of the South and the North. The plan might have worked, but Whiting died suddenly the following year, and a vote from railroad shareholders restored former chairman Frank Gilmer to his post.
He also restored responsibility for determining the route of the railroad through Jefferson County to Milner, who had remained under contract with the South and North to oversee the construction of the railroad. Milner recognized the economic potential of the region early on. Some time after first standing atop Red Mountain in 1856 and seeing what he later called “this beautiful valley … a vast garden as far as the eye can see”, he became the first to walk there. imagine a thriving industrial city. As he worked to make this happen, Milner knew he was navigating dangerous waters.
In the contest with Stanton and his group, Milner and his associates held significant advantages. More importantly, the Alabama and Chattanooga route was already leveled and prepared for track laying, leaving little flexibility to change its planned route across the county. The final decision on where the two railroads would intersect rested with Milner.
The next major move in the battle came in the spring of 1870, when Milner made what seemed like an odd recommendation. He suggested Gilmer approach Stanton so that the two rival groups jointly get options on 7,000 acres of land along Village Creek. This was the area Milner actually favored as the site of the New Town, with its many springs and streams that provided an abundant supply of water.
It seems doubtful that Milner expected a direct deal from Stanton, whose next move was quite in character. Within weeks, he reneged on his deal with Gilmer and instead got 60-day options on 4,150 acres to the south and east of the 7,000-acre area. The options were payable at the offices of Josiah Morris & Company, a private bank in Montgomery. Stanton then exercised what little flexibility he had on the Alabama and Chattanooga highway to ensure he would pass through that property.
Stanton intended to force Milner’s hand on the crossing site and let Milner and his associates hold the bag on land that, in fact, was of no value. Without a level crossing there, there would be no city.
With Stanton now engaged, Milner threw his rival off balance by putting on a great show by surveying several potential staging sites while publicly hesitating on which would be the most beneficial. During this time, he convinced Morris that establishing a new town was the key to unlocking the mineral district’s vast economic potential. Milner offered the Montgomery banker a position as the largest shareholder in what would be known as the Elyton Land Company, which would lead the town’s development.
Milner suspected from the start that Stanton would not have the money to exercise all of his options on the 4,150 acres, which has proven to be correct. When the options expired, Morris immediately paid $ 100,000 in cash (approximately $ 2 million in current dollars) to purchase the title deeds. He then sold about 80% of his new holdings to nine men who became shareholders of the Elyton Land Company when it was founded in December 1870. It was at a shareholders’ meeting the following month that the name Birmingham, in l honor of the great iron and steel center of England, was selected for the nascent city.
“The result was full of paradoxes,” wrote historian David Lewis. “It turned out that the site on which Birmingham was built was not originally selected by the victorious South & North group, but was instead co-opted by them thanks to Milner’s skillful maneuvering. The person who had chosen where the new city would rise, taking options he never exercised, was John C. Stanton, who had used every resource at his disposal to prevent it from being born. .
But Stanton didn’t give up.
In April 1871 – even as construction of the South & North entered Jones Valley and headed for the level crossing chosen by Milner – the railway ran out of money, with insufficient funds to make a scheduled payment on government guaranteed bonds.
Various appeals were launched to the financiers of the North without success. The would-be founders began to despair that their vision of Birmingham – for which the main street grid was already being drawn – would never come true.
This is the first known photograph of Birmingham. It was taken from the New Jefferson County Courthouse, either in 1873, when it was built, or in 1875, after its completion, (Photograph by AC Oxford, William H. Brantley Collection, University Library of Samford, Bhamwiki)
Overview of Birmingham, c. 1885. (Norris, Wellge & Co., Library of Congress, Prints and Photographs Division)
Realizing the situation, Stanton took his last step. He quietly raised the money to acquire most of the southern and northern first mortgage bonds, then demanded that the railroad pay the interest owed or be taken over by Stanton’s new allies.
Birmingham was doomed to fail – or so it seemed.
The city’s salvation came in the person of Sloss. A longtime railroad owner and main proponent of Alabama’s industrialization, Sloss had followed with great interest the drama surrounding the development of Birmingham. (Among other connections, he was a close friend of Josiah Morris.) Nashville & Decatur of Sloss was a satellite of the South’s main rail line, the Louisville & Nashville Railroad (L&N), which planned to connect with the South and the North to its terminus at Decatur.
Informed of the plight of the South and North, Sloss approached L&N Chairman Albert Fink with a proposal: If Fink made the payment of the overdue bonds on behalf of the South and the North, would assume all of his debts and fund his completion. Birmingham to Decatur, Sloss would lease his railroad to the L&N for 30 years. Seeing a golden opportunity to gain an effective monopoly on rail traffic from Nashville to Montgomery and to have a head start on the competition in the race to open access to the Gulf of Mexico, Fink agreed. .
Fink’s ensuing struggle to convince L&N’s board of directors to accept the proposal – in which Sloss again played a central role in the resolution – was in itself a question of considerable drama. But in the end, the proposal was approved, the South and North saved from ruin, and Birmingham – where the first lots would be sold on June 1, 1871 – saved.
In the process, Sloss moved to Birmingham, where he became one of the city’s most revered citizens. He was a founder, director or investor in many early companies, including the Sloss ovens, which began producing iron in 1882 at its factory on the outskirts of Birmingham city center, and which is today preserved as a National Historic Landmark.
As for Stanton, his Alabama & Chattanooga line went bankrupt at the end of 1871. Back in Chattanooga, he eluded creditors while trying to recoup his fortune through a series of business ploys, none of which really worked. . He ran for mayor of Chattanooga in 1879 and lost hard, leaving the city the following year in a cloud of lawsuits.
In the end, things didn’t go too bad for Stanton. He moved to New York City, where he regained some wealth and lived comfortably until his death in 1901 at the age of 76.
By then, Birmingham – a city he had hoped to crush before he was born – was here to stay.