The Dawn of Innovation (17 page)

The directors invented the waterpower unit to calculate a water-leasing rate. They started with the volume of water required to run the first Waltham plant, adjusted it for the greater head at Lowell, and defined that as one waterpower. They estimated how many waterpowers the works could support and set a unit price that presumably would amortize each new extension of the works. The unit price was finally reduced to a per-spindle price, based on the approximately 3,600 spindles in the reference plant at Waltham.

Lowell was also the site of one of Moody's simplest but most important insights: it dawned on him in 1828 that he could connect the main plant's drive shaft to the waterwheel with a broad belt. British mills used cast-iron bevel gearing for drives in both water- and steam-driven applications. The gearing was heavy and consumed a great deal of power. Worse, if a gear cracked, it could take a week or more to get replacement casts. Belts frequently broke but were easily replaced. Over time Moody's drive-shaft belting became standard everywhere.

 

The Locks & Canal Company was by far the greatest industrial development in the country, and its impact on machining, metalworking, and other industrial technologies is hard to overestimate. George Gibb, the historian of the Lowell machine works, puts the case:

Considered solely as a hydraulic operation, Locks & Canal was world class. By the mid-1830s, it serviced twenty-five textile mills plus a variety of other water-powered businesses, including Moody's machine shops, and by the late 1840s, its waterpower canal network was more than seventeen miles long. Much of its success was due to its long-serving chief engineer, James B. Francis, another self-taught prodigy who assumed his post in 1837 at the age of twenty-two. Over the course of the next half century Francis became arguably the world's leading authority on hydraulic power. His
Lowell Hydraulic Experiments
were masterpieces of adroitly combined theoretical and empirical exposition. They were issued and regularly revised and reissued for a quarter century, especially advancing the fields of flow measurement and hydraulic-power transmission efficiency. Francis was a leader in the conversion of waterwheels into turbines starting in the late 1840s, and his underwater turbines achieved energy conversion rates in excess of 90 percent. A comparison of two advanced mid-century water sites illuminates Francis's contribution to hydraulic engineering.

In 1851, Henry Burden, one of America's great inventors, iron men, and waterpower innovators,
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built the world's most powerful waterwheel at his works in Utica, New York. It was sixty-two feet in diameter, weighed 250 tons, was beautifully geared for smoothly efficient operation, generated up to 300 horsepower in work output, and ran almost without interruption for a full half century.

Also in 1851, Francis and a superb Lowell Machine Shop mechanic, Uriah Boyden, installed a Boyden-Francis turbine at the Tremont Mill in Lowell. Boyden had done the lion's share of the design and development work, while Francis, as Boyden's primary customer, had created a rigor-ous
design and testing environment to guide the conversion of Lowell waterwheels to turbines. The 1851 Boyden-Francis turbine was five feet in diameter, a twelfth the size of Burden's wheel. It weighed four tons, a sixtieth the weight of the wheel. And it generated up to 500 horsepower in work output, or 60 percent more than that of the wheel.
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The high-efficiency Francis turbine
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is still used in almost every hydroelectric plant in the world, generating about a fifth of the world's electricity. Francis retired in 1884, although he lived in Lowell and remained a consultant to the company until his death in 1892.

The “Boston Associates” is the name the historian Vera Shlakman pinned on the founding group of the Waltham-Lowell venture, along with the other investors drawn in as the companies prospered, and it has stuck ever since. Robert Dalzell lists seventy-five members of the Associates between 1813 and 1865. With five Appletons, three Cabots, three Jacksons, four Lawrences, four Lowells, and two Lymans, they were as ingrown as the Hapsburgs.

The durability of the group was partly a consequence of the loosely affiliated nature of the businesses. By spinning off Locks & Canal, the original Associates got diversification—they received their pro rata shares in the spin-offs and could invest further if they chose—and retained a voice in protecting their investment in the waterworks.

Locks & Canal, however, was also a real estate and manufacturing company. It leased land and water sites and, since the spin-off included Moody's machine shops, constructed lessors' waterworks and much of their machinery. Over time, the real estate and manufacturing businesses were spun off as well. Locks & Canal remained Lowell Manufacturing's
most important client, of course, but Lowell Manufacturing also developed a line of steam engines and was quite profitable in its own right. Intercompany relationships were simplified by the fact that the first wave of independent mills at Lowell were mostly owned by Associates. Kirk Boott had two, for instance, and Appleton was an investor in several.

The Lowell arrangement became a favored venture investing model for the Associates: Acquire water rights on an undeveloped river, construct the required power hydraulics—dam, canals, power supply for the first plant—build a textile factory and a machine shop, then lease the remaining waterpower to other entrepreneurs. James K. Mills, for example, was a prominent Boston merchant and an Associate. He was involved in at least four such ventures both as an investor and a director, two of which, at Chicopee and Mt. Holyoke, have been extensively researched by historians. There was no assurance of great financial rewards. The Mt. Holyoke group raised $2.45 million—a huge sum for the day. Most of it went for a 1,000-foot-wide dam on a river with a 57-foot head, that collapsed on the day it was opened. It was expensively rebuilt and then rebuilt again, and the investors lost every penny. Nevertheless, Mt. Holyoke became a successful paper manufacturing city, partly because of the sunk capital investments of the pioneers. Mills was wealthy and hardly a patsy; one imagines he worked so hard on his start-ups because he enjoyed it.
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The Associates also controlled more subtle networks of power. The Massachusetts Hospital Life Insurance Company was not specifically an Associates company. It was chartered in 1818 and awarded a monopoly on the state's life insurance business, so long as one-third of its life insurance profits went to the Massachusetts General Hospital. Only the great and the good are awarded such franchises, and by the time the company was fully operative in the mid-1820s, it was firmly within Associate control. From its founding until mid-century, two-thirds of its directors were Associates, as were all its finance committee members, prominently including Nathan Appleton and Patrick Jackson. There were three lines of business: annuities and life insurance for young men of modest means, life annuities for widows, and trusts for the better off. Profits from the trust business didn't have to be shared with the hospital, and it filled a real need for Associate families, who were suddenly amassing large sums of cash from textiles.

 

Layout of Advanced Mid-Century Water Plant:Robbins&Lawrence, Windsor, VT, 1846

Within just a few years after it went into operation, Massachusetts Life was by far the largest financial institution in the state, operating almost as an Associate investment club. At first the company followed its charter strictly, limiting its investments to high-quality mortgages, government bonds, and similar instruments, but by the 1830s roughly half of its investments had shifted to textiles. To comply with the charter, textile investments were usually reclassified as personal loans collateralized by small amounts of textile shares. The conflict of interest is stark, since many such loans generated lower returns than less risky blue-chip paper. Loans were also regularly extended or reworked when friends or family of Associates had trouble making payments. It is not likely that any of the Associates perceived a problem. The Massachusetts Life trusts still had decent returns, and since they were mostly funded with Associate money, who could object to their being invested in their own businesses? Similar patterns of ownership and control prevailed in Massachusetts banks and railroads.
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The “model village” aspect of Lowell and its mill-town clones came under pressure during the tough economic times of the 1830s. The once-docile mill girls walked off the job at Lowell and other mills when managers imposed wage cuts and rent increases on the mill girls. On the first occasion, in 1834, the Lowell girls retaliated by withdrawing all their savings from the local banks. During another walkout in 1836, one of them took to the stump and made “a neat speech,” marking the first time a woman had ever spoken in public at Lowell.
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Note that these actions occurred
before
Dickens's visit.

By the 1840s, conditions that had appeared enlightened twenty years before were looking considerably harsher to independent observers. A ten-hour-day law was bitterly opposed by the mill owners. The Lowell Female Labor Association was formed in 1844 and led ten-hour petitioning and organizing drives throughout the state. (The fact the mill girls lived together and had developed experience in print publications made them formidably
effective.) Although mill organizing was a major advance toward woman's emancipation, the legislature resisted ten-hour-day legislation for another thirty years.

Even deeper problems were coming to the surface. Boston was the epicenter of the American abolitionist movement, and all cotton-related industry was built on slave labor. The entanglement of leading Boston shipping and mercantile families with slavery was a long-standing one, for Boston had been the headquarters of the three-cornered “slaves, molasses, and rum trade,” and not a few New England sea officers had captained slavers. The split between Cotton Whigs and Conscience Whigs became irretrievable during the political battles over Texas and the Mexican War. In 1848, Charles Sumner denounced the alliance between “the cotton-planters and flesh-mongers of Louisiana and Mississippi and the cotton-spinners and traffickers of New England—between the lords of the lash and the lords of the loom.” Families were riven over the question. Sumner himself was an in-law of Nathan Appleton, the de facto leader of the Cotton Whigs.

Appleton, the last of the original Associates, died in 1861. The
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did not survive the Civil War. A number of mills had gone out of business during the financial panic of 1857, and the inability to buy cotton during the war wiped out many others. The younger generations of Associates were generally quite wealthy and in the main not especially interested in textiles. The textile business itself did recover after the war, but it was meaner and much more competitive. Mill working conditions deteriorated dramatically in the second half of the century, as farm girls gave way to immigrant labor. American factory conditions in general, not just at the mills, converged with those in England and in some industries, like steel, became even nastier.