The Record · Chapter Four · 1893 to 1900

The White City and the Company Town

A world’s fair that paid its stockholders a dime on the dollar while its directors’ businesses cashed in, a model town that cut wages and kept the rent, and a river turned around before a judge could stop it.

Chicago · 30 September 2026

Two bodies, on purpose

In 1893 Chicago threw the World’s Columbian Exposition, the White City, on the lakefront in Jackson Park. It is the third star on the city flag. It is also the best-documented money machine in this Record, because the men who ran it wrote reports.

The Fair was run by two bodies at once. A federal commission gave it the government’s blessing. A private Illinois corporation, the World’s Columbian Exposition, held the money. Its board was elected by stockholders. Its presidents were Lyman J. Gage of the First National Bank, then William T. Baker, then Harlow N. Higinbotham of Marshall Field’s store. The directors included Potter Palmer, Cyrus McCormick, Samuel Allerton, Joseph Medill and Charles Wacker. Merchants, packers, a newspaper owner, men with railroads and land.

First they had to win it. New York wanted the Fair too, and New York money, the Morgans, Vanderbilts and Astors, pledged a pile to get it. Chicago’s own heavy hitters, Field, Armour, Swift, McCormick, Yerkes and Gage, raised a local pile and brought it home. That fight was about which city’s hotels, railroads and landlords would get to serve the visitors.

Where the money came from

The pipes into the Fair were four.

Stock. About 30,000 people bought shares, and the company raised a little over $5.6 million that way. It looked like the whole city chipping in.

City bonds. The City of Chicago issued $5 million in bonds for the Fair, after the state constitution was changed so it could. Taxpayers backed the show.

Coins. Congress minted souvenir half-dollars, 50 cents on their face, and the Fair sold them for a dollar. They brought in about $2.45 million.

Bonds from the Fair itself. Banks took some, and the railroads took large blocks. So the same railroads that would haul millions of visitors to Chicago also held the paper that built the gates.

Where the money went

By the official count, the Fair took in about $28.15 million from all sources. About $10.63 million of that came at the gate and about $3.70 million from concessions.

The 30,000 stockholders got back 10 percent of what they put in. A dime on the dollar.

That number is the tell. The Fair corporation was never where the profit sat. The profit sat next door. More than 27 million admissions walked past the hotels, the restaurants, the streetcar lines, the Loop stores, the rented concessions on the Midway and the land around Jackson Park. The directors owned or ran a lot of that. The stock certificate was a civic badge. The adjacent business was the take.

One fight on the grounds is worth a line. General Electric, formed the year before out of Edison’s company and backed by J.P. Morgan, bid to light the Fair. George Westinghouse, holding Nikola Tesla’s patents for alternating current, underbid them and won. The published figures for those bids do not agree with each other, so we are not printing any until we have the Fair’s own construction records. The outcome is not in doubt. Alternating current lit the White City, and it lights your house today.

The Midway and the gate

The Midway Plaisance was the Fair’s amusement strip, and it was a rent machine. Rides, food and so-called villages where people from around the world were put on display for a ticket. Native people were staged as a vanishing race. Black Americans were largely kept off the main grounds as exhibitors.

We call this play exhibit, not exhibitor. You can put a people on display and still keep them out of the room where the money is counted.

Two pamphlets answered it at the gate, and they are the most honest paper from that whole summer.

Simon Pokagon, a Potawatomi writer whose father had signed away the land Chicago stands on, printed The Red Man’s Rebuke on birch bark and sold it to visitors. He told them, in effect, that they were celebrating on his people’s ground.

Ida B. Wells, Frederick Douglass, Irvine Garland Penn and Ferdinand L. Barnett wrote The Reason Why the Colored American Is Not in the World’s Columbian Exposition, and handed it out at the Fair.

Two communities. Two pamphlets. One fair. The Fair was lit up for the world, and they wrote anyway.

The model town

While visitors toured the White City, some of them took the train south to see another Chicago showpiece, the town of Pullman.

George Pullman’s Palace Car Company built and ran sleeping cars. By the 1890s it had about $36 million in paid-up capital and had paid its stockholders 8 percent a year for decades. Pullman also built a whole town for his workers by Lake Calumet. Brick homes, parks, a library, a church. Visitors called it a model.

The company owned every house. You could rent, never buy. Rent was set to earn the company a 6 percent return on the real estate, and it came out of your pay before you saw it. Gas and water came from the company too.

Then came the Panic of 1893 and the orders dried up. The company cut wages, again and again. It did not cut the rent.

The federal commission that later investigated put the numbers side by side. In the year ending July 31, 1893, the company paid $2.52 million in dividends and $7.22 million in wages. In the year ending July 31, 1894, it paid $2.88 million in dividends, up, and $4.47 million in wages, down. It was sitting on about $25 million in undivided profits.

We call this play two registers, one office. The same company holds the paycheck and the rent. Cut one. Leave the other. Call the town a gift.

The strike

On May 11, 1894, the Pullman shops walked out. The American Railway Union, led by Eugene V. Debs, backed them by refusing to handle Pullman cars, and railroads across much of the country ground down.

The railroads’ managers asked Washington for help. President Grover Cleveland sent federal troops to Chicago over the objection of Illinois Governor John Peter Altgeld, the same governor who had pardoned the Haymarket prisoners the year before. The legal hook was the United States mail. The strike was broken. Debs went to jail.

The dividends had already been paid.

The United States Strike Commission, led by Carroll D. Wright, put the whole thing on the record afterward. That report is where the numbers above come from.

The men who made the beds

The Pullman porters were Black men who worked the sleeping cars. They were paid so little that tips made up much of their living. The sleeping car was luxury for the passenger and a hard living for the man who made the bed.

Their full story is not in our files yet, and it deserves more than this paragraph. It leads to the Brotherhood of Sleeping Car Porters, founded in 1925 by A. Philip Randolph, with one of its strongest divisions right here in Chicago under Milton P. Webster. That is a win, and it gets its own chapter.

The last dam

The Sanitary and Ship Canal was ready at the end of 1899. It would send Chicago’s sewage down the river to the Illinois and the Mississippi instead of into the lake. St. Louis, downstream, did not want Chicago’s sewage in its drinking water, and Missouri was getting ready to ask a court to stop it.

Chicago did not wait. Early on a freezing morning, January 2, 1900, sanitary district trustees went out without notice to the last earthen dam on the canal and cut it. The water started moving. By January 17 it was at full flow.

When Missouri filed, there was nothing left to stop. The case, Missouri v. Illinois, went on for years and eventually went Illinois’s way. The canal cost $33.5 million and ran 28 miles.

We call this play speed for the deal, paperwork for the objector. Move before the other side can get a judge. Let the lawyers argue about it afterward. You will see it again more than a century later, in the City Council votes on the parking meters this fall.

Where this stretch ends

By 1900 the pattern was set. Treaty ground turned into lots. Lots turned into a crossroads. The crossroads threw a fair to advertise itself, let a company town run the same year and turned a river around before a court could blink.

Before the year was out, a dinner in New York would start the biggest deal in the history of the mills, and the mills would buy a stretch of Indiana shoreline and name a city after the chairman. That is the next chapter.

The scoreboard

Holes, named

Sources

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