Heroes of Progress in America - Charles Morris

George Peabody,
the Banker Philanthropist

On more than one occasion men of wealth have come to the aid of this country when in need, and won fame by their patriotism. We have spoken of two of them, Robert Morris, the financier of the Revolution, and Stephen Girard, who bought the unmarketable Government securities in the war of 1812, and relieved the authorities in a great emergency. There is a third, less known, though not less patriotic, to be named George Peabody, who used his wealth to sustain his country in the dark days of the panic of 1837.

Gloomy times were those. A black cloud hung over the nation. The business of the country was prostrated and the nation itself in disgrace, for it was unable to pay its debts. Money was needed for government purposes, but the credit of the United States was at a very low ebb. There was no money to be borrowed at home, and foreign capitalists were not eager to loan their funds, except at ruinous rates.

At that time there was an American merchant, George Peabody by name, settled in London, where he had done a large business and grown very rich. He had begun his business life in Baltimore, and when Maryland asked him for help in her low state of finances, Mr. Peabody did not hesitate. He showed his faith in his country by buying American bonds freely, at good prices. It was at a loss he did this, for the securities could have been had at lower rates, but Peabody's example was contagious, the other London capitalists having faith in his judgment. They began to buy bonds, too, and the crisis was passed. When the trouble was over, he declined to accept any reward for his valuable services.

This was a case in which Mr. Peabody was in no danger of losing his money, but he looked for no profit and was ready to face a possible loss. He afterwards gave such large sums for useful purposes, and was so benevolent, that he is looked upon as one of the noblest of philanthropists. It is for this reason that we feel called upon to tell the story of his life.

George Peabody was born at South Danvers (now known as Peabody), Massachusetts, February IS, 1795. He came from a good New England family, that included patriots and thinkers among its members, but not capitalists until he came. His father was poor. His education was scanty. He was taken from school and put at work in a grocery store at eleven years of age. Here he stayed for four years, getting some idea of how to do business, and showing some ability in that field. After a short experience in another store, he left South Danvers to take a place in his uncle's establishment at Georgetown, District of Columbia.

He was there in 1812, when the war with England broke out. Early in that war a British fleet came sailing up the Chesapeake and the Potomac, threatening the city of Washington, and the young merchant's clerk joined the band that prepared to defend the city. But the ships were only making a feint, and soon sailed away, and Peabody went back to the store.

Young as he was, he showed much of the business skill which was to make him rich in later days. He was shrewd enough to see one thing: the business was conducted in such a way that there was danger of his being held responsible for his uncle's debts. In fact, it was carried on for a time under his name. This induced him to give up his position and look around for another place. It soon came. A Mr. Riggs of Baltimore, a wealthy merchant, who had seen a good deal of young Peabody and knew that he was bright and trusty, offered to make him his manager in a dry-goods store in Baltimore, he supplying the capital and Peabody handling the business. This was a splendid offer for a boy of nineteen, and he lost no time in taking it. Mr. Riggs knew what he was about. The boy was alert and careful in business, with sound judgment, knowing when to make a deal and when to avoid one, when to spend and when to save. He had abundance of energy, he was industrious, honest, courteous, and had no bad habits. He was the man to command success and was soon made a full partner, the firm being named Riggs & Peabody.

The judgment of Mr. Riggs was fully justified. The business grew rapidly, branches were established in other cities, and before twenty years had elapsed both partners were very rich. Mr. Peabody had often crossed the ocean to buy goods for the firm, and in 1837 he decided to settle in London and carry on an English branch of the business. A quick interchange of goods was established between the two countries, money made rapidly at both ends, and large sums began to be left by customers in Peabody's hands, to be drawn upon when needed.

In this way he was unintentionally led into the banking business, and in 1843 the firm name was changed to George Peabody & Co., and banking made its principal business, the house dealing very largely in American securities. In this way he became one of the richest men of the time, his bank being looked upon as one of the strongest in London and immense sums of money intrusted to its care.

As for Mr. Peabody himself, he was a fine-looking but plainly-dressed man, generous and open-hearted, courteous and obliging. Americans in London always found a genial greeting at his office, and it became their common resort. He remained unmarried, living modestly in his bachelor apartments, but entertaining generously at his club. When the Fourth of July came around he did not forget that he was an American patriot, and for many years gave a grand dinner in honor of the day, to which distinguished guests of both countries were invited.

George Peabody was one of those warm-hearted, broad-minded souls who feel that riches are a gift from heaven to be used for the good of the world; their mission is one of duty to be done, not of hoards to be laid away. Giving, in his mind, stood side by side with getting; his nature was broadly charitable; he did not wait until death to dispose of his great wealth, but wisely gave it during his life, while he could see that it was well administered and that his purposes were faithfully carried out.

He began his career by giving. When a boy, with a very small salary, his earnings went to the needs of his mother and sisters. He had always a warm heart for those at home, and from the time he was twenty-four he took all the care of their support upon himself. Later, when his wealth began to grow enormous, he looked around for other places where he might do good. Being a bachelor, he had no family of his own to care for, and, with a broad Christian benevolence, he felt like making the world his family and using his wealth so that it would do the greatest good.

Mr. Peabody was wise enough to know that giving money for the direct support of the poor is a form of charity that may lead to more harm than good. It is apt to encourage improvidence, idleness, and a disposition to depend upon help rather than work, and the effect of caring for the poor in this way is often only to increase the number of the poor. He looked around to see where he could make his money do help without hurt, where it could benefit mankind by improving their conditions or, by aiding their education, put them in a way to take care of themselves.

His two greatest gifts were made for this purpose. But before stating what they were, there are some smaller examples of his public spirit to mention. In 1851, when the great world's Fair in London was being held, our Government had not much money to spare, and Congress was not willing to supply any funds for the American exhibit. Seeing this, Mr. Peabody generously offered to bear all the expense and to see that his native country was fitly represented. As a result there was a valuable American display, and the inventors and producers of the United States went home with many prizes and awards of honor. It was the first occasion in which the world was made to see the great things that America could do, and George Peabody gave it the opportunity.

In 1852 he gave ten thousand dollars to pay the expenses of the celebrated expedition of Dr. Kane to the Arctic Seas in search of Sir John Franklin, who had gone there years before and failed to return. In the same year his native town of Danvers celebrated its hundredth birthday, and he honored the occasion by sending it twenty thousand dollars for an institute and a library. This was only a beginning. He kept adding to it until the sum was more than two hundred thousand dollars.

In 1857 Mr. Peabody had been away from the United States for twenty years, heaping up wealth in his foreign domicile. He thought it time to see his home country again, and paid a visit to the United States, going to Danvers and Georgetown and Baltimore, and recalling his old memories in those places. For many years he had been thinking over a plan for benefiting Baltimore by a great educational institution, and had carefully laid out plans for it. He wanted it to be one that would grow and keep up with all demands upon it.

This splendid institution he saw well under way before he left America. It is called the Peabody Institute, and includes a large free library, an academy of music, an art gallery, and rooms for the Maryland Historical Society, which he helped also with money. To this institution he gave over a million dollars, supplying the money from time to time as his plans unfolded and the institute developed.

A greater gift was that which he made soon after to the city of London, for it was one which reached down to the needs of the suffering poor of that mighty city. Mr. Peabody had long seen in what miserable homes they lived and the dirt and degradation which surrounded them. To provide these hard-working and poorly paid people with comfortable homes and healthful surroundings was one of the best ways of helping them, and this he was among the first to see. The industrial home which he built, and the opportunities for education and recreation he provided, cost him in all about two and a half millions of dollars. It was a splendid benefaction and was gratefully received. Queen Victoria offered to make him a baronet, but Mr. Peabody was a true American and would accept no title. Then she had her portrait painted on ivory and set in jewels, And presented it to him as a token of her deep feeling for his charity to her people. This was deposited by him in the institute at South Danvers.

His greatest gift was for the education of the poor of the South. The Southern Education Fund, as this is called, was a gratuity of $3,500.000. It has been of immense benefit in the advancement of education in that section of our country, in which education was then greatly neglected, and it is of as much service to-day as when it was given.

These are not all of Mr. Peabody's gifts. There were many smaller ones. Harvard and Yale Colleges each received $150,000, and smaller sums, for churches, institutes, libraries, and colleges, were given to a number of American towns. His total gifts amounted to about eight and a-half million dollars, and when he died he left five millions to be divided among his relatives and friends.

He did not wait till death to dispose of his money; he gave it during his life, and was careful to see that his instructions were carried out. As a consequence, his gifts have not gone astray in their objects, but are still doing good. When he died, on the 4th of November, 1869, his body was laid in state in Westminster Abbey, and was then brought to this country in a royal man-of-war. Here it was received with the highest respect and buried with national honors.

While so generous to the public, Mr. Peabody was abstemious in his personal habits. He had to live with close economy in his youth, and he never changed from this. His habits were very simple, and he might often be seen making his dinner on a mutton chop at a table laden with viands, at his cost, for his friends. Ile dressed neatly but plainly, did not indulge in jewelry, and disliked display of any kind. In business methods he was very exact, and while giving away millions, would demand the last penny in the fulfilling of a contract. When the conductor of an English railway train charged him a shilling too much for his fare, he complained and had the man discharged. "It was not that I could not afford to pay the shilling," he explained, "but the man was cheating many travelers to whom the swindle would be oppressive."