Gold Rush Capitalists: Greed and Growth in Sacramento

Published by EH.NET (August 2005)

Mark A. Eifler, Gold Rush Capitalists: Greed and Growth in Sacramento. Albuquerque: University of New Mexico Press, 2002. iii + 280 pp. $21.95 (cloth), ISBN: 0-8263-2821-0.

Reviewed for EH.NET by Christopher J. Castaneda, Department of History, California State University, Sacramento.

The California gold rush prompted a frenzied mass movement of people toward the Sierra Nevada. Between 1848 and 1852, the state’s population increased from about 14,000 to nearly 225,000 people, and many of these persons traveled from outside the continental United States to California to strike it rich. While some did find enough gold to become very wealthy, many more toiled for little reward and then returned home or remained in California and engaged in other work.

It became evident to some of the most enterprising new arrivals to California that mining the miners was a more certain way to make money than mining for gold. Sacramento, which emerged as the major trading and distribution center between San Francisco and the gold fields was where some of California’s earliest and most significant capitalists set up shop to serve the miners’ needs.

Mark Eifler’s book, Gold Rush Capitalists, examines the background and first few years of Sacramento’s development in relation to the gold rush. Eifler, associate professor in the department of history and political science at the University of Portland, began this project more then ten years ago. It originated as his Ph.D. dissertation focused more on the Squatters Riot of 1850, but the book provides a much broader look at the origins and development of gold rush era Sacramento. His research was aided by an abundance of correspondence, journal entries and amateur reporters who traveled to and through the city on the way to the gold fields.

The book is divided into three parts. Part I, “The Grand Bazaar,” traces Sacramento’s origins back to the early expeditions of Jedediah Smith and trade with the Miwok. More attention is given to the establishment of (John A.) Sutter’s Fort in what today is midtown Sacramento; Sutter’s Mill was farther east in the foothills on the American River. Sutter’s Fort became the first center of business activity in pre-gold rush Sacramento. Sutter, and much more so his son, John Sutter, Jr., later exercised considerable influence on how the city developed simply due to the extent of their land holdings, but it was the Mormon publisher and merchant Samuel Brannan who realized that the land on the Sacramento River adjacent to the mouth of the American River and not far from Sutter’s Fort, was the best location for what was developing as the town of Sacramento. John Sutter, Sr. wanted his “Sutterville,” three miles off the current trade route, to be the new urban center, after James Marshall first saw gold in the American River at Sutter’s Mill in January 1848.

The gold rush dramatically accelerated Sacramento’s development, and in Part II, “The Encampment,” Eifler carefully traces this change. Although Sutter’s Fort was already a small commercial center and distribution point, the influx of large numbers of transient miners as well as smaller numbers of sedentary merchants who became the new city’s founders created new urban dynamics. Conflict developed between these two groups, referred to as squatters and speculators, leading to what became known as the Squatters Riot of 1850. This riot was a violent manifestation of the tension between Sacramento’s newly emerged population of landholders and landless.

Out of this direct conflict came a resolution of sorts. In the book’s final section, “Improvisation,” civil law prevailed and a new Western city was born. Describing the lynching of Frederick Roe as this turning point, Eifler shows how city residents accepted the absolute need for law in quelling reckless and violent behavior in Sacramento. With law imposed and respected, the capitalist activity that created the town could be guided and shaped in a manner conducive to what Eifler phrases as “admirable confusion” rather than the “chaos of commercialism” (p. 3 and p. 24).

This book is important for providing careful attention to the origins of an important gold rush town that was largely overshadowed by San Francisco. Eifler provides very detailed descriptions of some important events in early Sacramento history, and he is quite successful in providing the reader with a good understanding of how Sacramento developed during the early years of the gold rush. Although it wasn’t Eifler’s aim to do so, it would have been quite interesting to follow Sacramento’s early history a bit farther to more fully trace the development of its capitalist founders. Eifler gives us only a glimpse of the Sacramento merchants who later in the 1860s became the Big Four of the Transcontinental Railroad (Mark Hopkins, Leland Stanford, Collis Huntington and Charles Crocker) and built upon Sacramento’s commercial foundation to construct a transportation system that linked California with the Midwest. But the railroad, like much of the West Coast’s big business activity, moved on to San Francisco. An examination of gold rush era capitalists really has to look at what those successful capitalists did with their capital and how they contributed — or not — to the development of their home city. Remaining focused largely on the period of 1848-1851, therefore, is both a strength and weakness of the book. Yet, there is no doubt that the events of this brief time period constituted a seminal era in Sacramento’s history. Although, the numerous extensive quotations in the Part III tend to disrupt the narrative somewhat, Eifler has done a very nice job transforming his dissertation into an important book on this subject.

Eifler has rightly tackled an important topic in both urban and business history. Sacramento had a beginning as unique as the gold rush, yet its history remains noticeably unstudied and overshadowed by that of San Francisco. Eifler’s work will help to rectify this imbalance and certainly lead to the needed additional scholarship that he has helped to jump start.

Christopher J. Castaneda is chair of the Department of History at California State University, Sacramento. He recently edited a themed issue of the Journal of the West on the topic of “Energy in the West.” He has written widely on the natural gas industry, including the entry on the “Manufactured and Natural Gas Industry” in EH.NET’s Encyclopedia at http://eh.net/encyclopedia/?article=castaneda.gas.industry.us.