Blacks In Business - Producers, Not Just Consumers

by Beverly Dunn Lucas

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A glistening snow covered the hills of Cincinnati and the Ohio River was a solid block of ice on the day Robert Gordon became that city's most powerful man. Residents of the "Queen City" awakened on that frigid, blustery winter morning to the sight of icicles hanging from the trees like crystal ornaments. And anyone who needed coal discovered that Gordon, an ex-slave from Richmond, Virginia, controlled all the coal in town.

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How Gordon was able to attain such a powerful position was a combination of luck, fate, and perhaps most importantly, strategic planning by a shrewd businessman who refused to allow others to determine his destiny.

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As a slave in Virginia, Gordon worked in a blacksmith's shop where his owner permitted him to earn money by selling coal. Eventually, he was able to save $15,000, which he later used to purchase his freedom. As a free man, Gordon moved north, settling in Cincinnati where he attempted to ope'lan that later proved to be their undoing, the city's white coal merchants conspired to keep Gordon out of business by refusing to sell their coal to him.

Determined not to be defeated, Gordon sent mulattos to purchase cheap coal from the unscrupulous coal men. By continuing this plan for some time, Gordon accumulated a large stockpile of coal for himself and depleted the reserves of the white merchants.

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When the temperature dropped so low that the Ohio River froze, the great coal barges traveling upriver were paralyzed, unable to deliver their precious cargo. Thus Gordon controlled the only coal in town. Throughout his career he proved to be an astute businessman. His coal yard prospered, and by 1869 Gordon's net worth was estimated at $60,000.

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Few American history books tell the story of Robert Gordon or the story of any of this country's early black entrepreneurs. However, some historians today are attempting to correct this omission by documenting many of the entrepreneurial endeavors undertaken by Blacks before, during, and after slavery.

In the traditional versions of American history, scant attention is paid to the fact that in 1619 the first Blacks on these shores were actually indentured servants. This distinction enabled these settlers, both Black and white, to work for their owners for an agreed-upon period of time and then buy their freedom with a portion of their wages.

In The Free Negro in Virginia, John H. Russell observes that during this period Blacks had "about the same industrial or economic opportunities as the free white servant." As such, they were able to conduct business and buy property. Such an arrangement is typified by Richard Johnson, a Black carpenter from England, who came to Virginia in 1651 as an indentured servant. By 1654, Johnson had paid off his debt to his owner and had purchased 100 acres of land in Northampton County, Virginia.

Even after slavery took firm root in our country, some owners gave their slaves the opportunity to buy their freedom. Many of these slaves had skills such as blacksmithing, carpentry, or shoemaking, and kept businesses that offered these services. As with the indentured servants, some of these slaves were allowed to keep a portion of the wages earned from their businesses while paying a percentage of their earnings to their owner. By saving a portion of their earnings many of these slaves could also buy their freedom.

One example of such an arrangement is illustrated by James Derham, who was born into slavery in 1767. Derham, who was owned by a physician in New Orleans, served an "apprenticeship" and in 1783 was able to buy his freedom. By 1788, Derham's practice consisted of both Black and white patients, and he was considered to be one of that city's preeminent physicians.

Free Blacks in the North also owned and operated businesses that flourished. In 1736, Emanuel and Mary Bernoon were the owners and proprietors of the first oyster and ale house in Providence, Rhode Island.

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In nearby Dartmouth, Massachusetts, Paul Cuffe, a Black merchant and sea captain, began his business in 1779 at the age of 20 with one boat. Cuffe eventually built up his fleet, and by 1806 he owned one ship, two brigs, several smaller vessels, houses, and land. In the course of his business, Captain Cuffe routinely sailed to the West Indies, Europe, and Africa, as well as to ports in the southern United States.

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Because of Cuffe's success and wealth he was expected to pay personal taxes to the Commonwealth of Massachusetts. But in spite of his wealth, Captain Cuffe was denied the right to vote because of the color of his skin. Cuffe refused to pay his taxes and questioned the constitutionality of such taxation without representation. Cuffe and his brother John petitioned the Massachusetts legislature for the right of suffrage. To the surprise of many, the Legislature granted the brothers' petition, and from that time all free Blacks in Massachusetts who paid their taxes were entitled to all of the full privileges of United States citizens.

In the 1800's, Black business owners produced a number of firsts in spite of the passage of more and more legislation designed to restrict their rights. The abolitionist and anti-slavery movements were hotly debated topics and were the subject of many editorials in the papers of the day. But educated Blacks seeking a forum in which to publish their opinions began founding their own newspapers. The first, Freedom's Journal, was published in New York on March 16, 1827, by John B. Russwurm and Samuel E. Cornish. In that first edition Russwurm and Cornish wrote:

"We wish to plead our own cause. Too long have others spoken for us. Too long has the public been deceived by misrepresen-tations in things which concern us dearly.... For though there are many in society who exercise towards us benevolent feelings, still there are others who make it their business to enlarge upon the least trifle which tends to the discredit of any person of color and pronounce anathemas and denounce our whole body for the misconduct of this guilty one..."

Publishing was only one of the entrepreneurial endeavors engaged in by Blacks.

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The census of 1850 revealed a group of Black business owners in New York that included in its ranks more than 100 barbers, 23 tailors, 23 hose makers, 21 boardinghouse keepers, 11 inkmakers, 8 cigar makers, 3 jewelers, 2 hatters, and 2 confectioners.

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Throughout the country Black entrepreneurs managed to make names for themselves despite the bigoted attitudes that prevailed over most of the land. Jehu Jones owned one of the leading hotels in Charleston, South Carolina. Henry Topp of New York and Thomas Dalton of Boston were prominent tailors and clothing merchants. The records of Stephen Smith show that in 1849 he owned more than 2 million feet of lumber, railroad cars, and stock worth $27,000.

During this period Blacks made contributions to the banking and insurance industries. The American Insurance Company of Philadelphia, founded in 1810, was the nation's first Black insurance company. The Capital Savings Bank of Washington, D.C., became our country's first Black bank when it opened on October 17, 1888.

In the period after the Civil War, legislation reinforced by court decisions sharply curtailed the rights of Blacks. But the very laws that prohibited integration and limited Blacks' rights also gave an unintentional boost to the Black entrepreneur. Many businesses, such as hair salons, barbershops, mortuaries, restaurants, and newspapers, were owned by Blacks who profited handsomely from "captive" customers who were prohibited from doing business with white merchants. Black business owners grew in number, and by 1903 it was estimated that 25,000 businesses were owned by Blacks.

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One of the greatest success stories of this era is that of Madame C. J. Walker, the first female Black millionaire.

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In the first decade of the twentieth century Madame Walker made her fortune developing and marketing a line of hair and beauty aids for Black women. Her most noteworthy device, the straightening comb, can still be found in many homes and on the shelves of beauty supply stores today.

As evidenced by these vignettes, Black entrepreneurs made many important contributions to the Black community and to the community at large. As the twentieth century rolled on, events such as the two world wars, the Great Depression, and the demise of desegregation radically altered the course of life for Blacks in America. In Part 2 of "Blacks in Business: Producers, Not Just Consumers," the impact of these developments on the Black entrepreneurial spirit will be examined.

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Selected Bibliography:

1. Aptheker, Herbert, ed. A Documentary History of the Negro People in the United States 1910-1932. Secaucus, NJ: The Citadel Press, 1973.

2. Woodson, Carter G. "The Mis-Education of the Negro." Crisis 38 (August 1931), 266-67.

3. Bennett, Lerone. Before the Mayflower, fifth ed. Johnson Publishing Company, 1982.

4. Fishel, Leslie H., and Benjamin Quarles, eds. The Negro American: A Documentary History. Scott, Foresman and Company, 1967.