Whiskey Men Who Became Midwest Millionaires

Foreword:  During the 18th Century, more than a few distillers, whiskey rectifiers and wholesale dealers found that the profits made in making and selling liquor could be used profitably in other productive enterprises.  By canny investing some became “captains of industry” and exceedingly wealthy.  The Midwest, experiencing boom times after the Civil War, presented a particularly favorable economic climate.  Presented here briefly are three stories involving whiskey men in Illinois and Indiana.  

The Herget Brothers, John and George, enhanced the economy of Pekin, Illinois, through their enterprise and investments encompassing a variety of enterprises.  At the center of their local business conglomerate was making and selling whiskey.   A 1910 history of Illinois described the Hergets this way:   “The members of the family stand high in the social circles of the city, and are universally respected for worth and nobility of character.” 

The Hergets immigrated to the United States from Germany as young men, eventually settling in Pekin.  Shown here, John on left, about 1860 they opened a grocery store that specialized in liquor.  

Seeing whiskey as good investment, in the fall of 1888 the brothers built the Star Distillery in Pekin and two years later opened a second facility they called Crescent Distillery. Later selling both, with the proceeds they then erected the Globe Distillery, at the time the largest whiskey-making plant in Pekin, having the capacity to mashing 5,000 bushels of grain daily.

During the late 1890s the brothers shut down their grocery and liquor enterprises actively to pursue other business interests.  John was involved with the Pekin Steam Cooperage Company, Pekin Gas and Electric Light Company., Turner-Hudnut Grain firm, Globe Cattle Company, Farmer’s National Bank, a beet sugar factory, and was a large landowner in Tazewell County.  George was a major investor in the founding of the Illinois Sugar Refining Company; the Globe Cattle Company, and the Pekin Stave and Barrel Manufacturing Company, of which he was president. In 1905, with sons Henry and William, he founded the Herget & Sons Bank, shown right.  Whiskey had fueled their business success.

Born into an immigrant Scottish family, brothers Thomas, James and John Gaff found opportunity in America’s midsection to create a commercial empire of extraordinary size and breadth. The Gaff saga began in 1811 when parents James and Margaret Wilson Gaff pulled up stakes in Edinburgh, Scotland and immigrated to the United States with their three-year-old son, Thomas.  The family settled first in New Jersey where son James was born in 1817 and John in 1820. Far from wealthy, the brothers from early on honed their skills in the mercantile trade.

After an initial move to Pennsylvania where the Gaffs ran a profitable general store and distilling operation, they were enticed to move to Aurora, a small town in along the Ohio River in southeastern Indiana, by an offer of free land and tax incentives.  With James Gaff, shown here, in the lead, upon arrival the Gaffs almost immediately built a distillery near town on the banks of Hogan’s Creek, a waterway that emptied into the Ohio River.  This distillery eventually produced rye, bourbon, and a scotch-type whiskey that the brothers dubbed “Thistle Dew.” The brothers called their facility  “T. and J. W. Gaff & Co.”  By 1850 it had become one of the largest distilleries in the United States.  An illustration of the complex in the 1800s shows its growth and proximity to the Ohio River.

The success of their whiskey-making spurred the brothers to build a brewery in Aurora, stretching for 300 feet along Market Street, an enterprise they called the Crescent Brewing Company.  With their access to the Ohio River multiplying products, it was almost natural that the Gaffs would gravitate to shipping.  They built and owned a fleet of steamboats,  

Founded on revenues from distilling  and brewing,  Gaff Brother investments came to encompass the Fleischmann Yeast Company,  Indiana grain and hog farms, a Louisiana plantation, a silver mine in Nevada, turnpike construction, railroad financing, banking, and a factory that reputedly produced the world’s first ready-made breakfast cereal.  An 1880 history of Indiana's eminent and self-made men captured Thomas Gaff's wide range of interests, both business and philanthropic, noting:  “His executive ability is remarkable. No transaction within the range of his complicated affairs escapes his observation.   

Crawford Fairbanks, shown here as a young man, has been characterized as a poor boy with limited education who studied by candle light.  A Union soldier during the Civil War, Fairbanks returned to Terre Haute, Indiana to start a grain business that soon transitioned to distilling.  After a number of false starts, explosions and fires in his facilities in 1884 he turned to John H. Beggs, a distillery executive from Peoria, for help. Together they organized the Terre Haute Distilling Co., that ultimately would be accounted the world’s largest of the time.  In time Fairbanks became immensely wealthy,  owning the Terre Haute Brewing Company, a strawboard factory, Terre Haute’s principal newspaper, and paper mills in Massachusetts, Chicago and New York.  

Additionally, Fairbanks liked owning hotels, buying the Terre Haute House, shown above;  the Denison Hotel in Indianapolis; and co-owning the French Lick Springs Hotel, a resort popular for its warm springs and reputed healing waters. He also was principal investor in Indiana Sonora Copper & Mining Co., and president of the Terre Haute Water Works and Terre Haute Street Railway Co.  At the time of his death Crawford also was the principal owner of the Standard Wheel Co. and president and major stockholder of Wabash Realty & Loan Co., that held title to most of his real estate, including several farms where he raised race horses.   

May 1924 obituaries of Crawford Fairbanks ran in newspapers throughout Indiana and beyond.  One state journal hailed him as “Indiana’s greatest financial genius.”  Another newspaper declared him “Indiana’s Richest Man.”  What too frequently was ignored was the original driving source of Fairbanks' wealth and enterprises — making and selling whiskey.  

Note:  Longer profiles of each of these men may be found posted on this blog.  Herget Brothers:  June 5, 2018;  Gaff Brothers, July 8, 2018;  and Crawford Fairbanks, June 13, 2018.  There also is a vignette on J. C. Beggs and his family, Oct. 17, 2017.

Crawford Fairbanks: Distilling Made “Indiana’s Richest Man”

Although characterized as a poor boy with limited education who studied by candle light, Crawford Fairbanks, shown here as a young man, had the advantages of a distinguished ancestry and a father who was mayor of Terre Haute.  Cited as “Indiana’s greatest financial genius,” Fairbanks seized every opportunity, beginning with owning distilleries, to amass his fortune.

Crawford’s pedigree included an ancestor, Jonathan Fairbanks, who came from Sowerly in Yorkshire, England, to Boston and settled in Dedham, Massachusetts.  There Jonathan built the noted “old Fairbanks House” in 1636 that is still standing as the oldest dwelling in New England, shown below. 

Crawford’s father, Henry, shown here, was born in Massachusetts and moved to Terre Haute in 1835, considered an early settler.  A farmer, the father eventually became “a strong factor in the political and general development in that part of the state,” according to a biography, serving as both Vigo County treasurer and mayor of Terre Haute.  

Crawford Fairbanks was born in 1843 near Terre Haute.  Despite his family’s prominence he was educated in local schools, said to have studied at night by candlelight after finishing farm chores.  He left school and home at the age of 17 to work as a clerk in town for $5.00 a week but soon was advanced to bookkeeper and given a raise.   

When the Civil War broke out, young Fairbanks answered the call and on March 1, 1864, at the age of 21, was mustered into the 129th Indiana Infantry Regiment and became a lieutenant.  His unit,  employed on Sherman’s march on Atlanta, saw some hot fighting along the way, including the Battles of Resaca, Decatur, and Franklin.  The last, shown below, was a crushing blow for the Confederacy resulting in devastating losses and 14 rebel generals either killed, wounded or captured.

At war’s end Fairbanks returned to Terre Haute to begin a business career, starting in the grain business, an enterprise that was a huge success.  When his partner left for the California gold rush, Fairbanks moved into making whiskey.  A major distillery in town had its beginnings about 1840, operated by a series of owners until Herman Hulman bought it in 1870.  [See my post on Hulman, June 23, 2012.]   Fairbanks became an associate of Hulman who, embarking on a long holiday trip to Europe, sold him the distillery.  When Hulman returned, having decided to re-enter distilling, Crawford sold him back a half interest.

The two men were partners in the distillery they now called “The Phoenix,” a name that might have been prophetic given the multiple times the facility had to come up from ashes.  In 1878 a fire destroyed a significant portion of the cattle pens and livestock on the property where cows were being fed the spent mash.  The cattle feeding operation had no sooner been re-established when in January, 1879, an explosion occurred that killed two employees and did considerable damage to the facility.  The partners quickly rebuilt.

Meanwhile Crawford Fairbanks was having a personal life.  In December 1872 at the age of 29 he had married Clara T. Collett, a local girl born in Indiana.  The 1880 census found them living in Terre Haute with a daughter, Sarah, and an Irish servant girl. 

Fairbanks and Hulman found themselves in legal trouble with a grand jury in Indianapolis in April 1879, accused of 1) illegally operating on Sunday, 2) hiding untaxed whiskey under a corn pile, and 3) owing the State of Indiana $57,000 for unpaid liquor taxes.  The partners either denied the charges or offered explanations, agreeing nonetheless to pay any delinquent taxes.  The grand jury dismissed the charges holding that the evidence presented did not prove fraud by Hulman & Fairbanks.

Again exiting the distilling trade, Hulman sold his half ownership to Robert S. Cox and the company became Cox & Fairbanks, in 1800 claimed to be “the world’s largest distillery.”  The four story main building was capable of mashing 5,600 bushels of grain daily and operated on an aging steam system.  One afternoon in October 1880 a boiler exploded and catapulted into the malt house, destroying the rear of the main building.  Although local firemen with the aid of citizens soon put out the fire, the blast killed seven employees, six immediately and one who later died from burns.  An inspector from Cincinnati also was killed.  A similar number of people were severely injured.  The concussion was heard for miles around.

Reeling from the 1880 disaster, Cox sold his half interest to Louis Duenweg and the company became Fairbanks & Duenweg.  The disasters kept coming.  Although no human casualties occurred, in June 1884 the the original four-story distillery burned to the ground.  Three hundred hogs were roasted when the fire spread to a nearby barn.  At that point Duenweg sold out to Fairbanks who turned to John H. Beggs, a distillery executive from Peoria, for help. [See my  post on the Beggs family, Oct. 17, 2017.]  Together they organized the Terre Haute Distilling Co., reputed to have been the world’s largest at the time.

The company produced "Elkader Whiskey," that came in flask and quart sized bottles. Shown here is an example of the care Fairbanks put into the marketing of his products. The label is a striking gold color with the whiskey name in an elegant script.  Even more interesting is the reverse side that carries the seal of Elkader, an Algerian Muslim who fought against French Rule. Note the sword, half-moon and star, all Arabic symbols.  This likely is the only American whiskey named for an Muslim hero.  

By now immensely wealthy, Fairbanks expanded his entrepreneurial abilities into other areas.  In 1889 with Beggs and minor investors he purchased the Terre Haute Brewing Company, one of the Nation’s largest.  At about the same time, Crawford built a strawboard factory in Elgin, Ill., which later became part of the American Strawboard Co., a $6 million concern known as the “Strawboard Trust.”  Fairbanks was elected president of the company on Feb. 4, 1897.  In addition, he had investments in and served as an officer and director of Diamond Paper Co., of Anderson, Ind.; Haverhill Paper Co. of Massachusetts.; Chicago Paper Co. of Illinois; Piedmont Paper Co. of New York; and Southern Indiana Gas Co., of Greenfield and Shelbyville.  He also owned Terre Haute’s principal newspaper, The Tribune, shown above left.

Fairbanks liked owning hotels, buying the Denison in Indianapolis, the Terre Haute House, shown above, and was co-owner of the French Lick Springs Hotel, a resort popular for its warm springs and reputed healing waters, shown left. At one time he also was the principal investor in Indiana Sonora Copper & Mining Co., and president of the Terre Haute Water Works and Terre Haute Street Railway Co.  At the time of his death Crawford was the principal owner of Standard Wheel Co. and president and major stockholder of Wabash Realty & Loan Co., which held title to most of his real estate, including several farms where he raised race horses. 

Along with his growing wealth, Fairbanks was generous to his home town.  After the Terre Haute Distillery was torn down, he gave the Henry Fairbanks Memorial Park to Terre Haute on the former site. To honor the memory of his mother, Crawford donated the Emeline Fairbanks Memorial Library to the city.  Both are shown here.  After his wife’s death in 1911 Crawford built the Clara Fairbanks Home for Aged Women in her honor.  A family history said of him:  “In his natural make up, the selfish and the small are absolutely left out, while all flash and extravagance…are as far removed from his nature and conduct as it is possible to have them.”

As he aged, Fairbanks’ health declined.  Described as “a man with few intimate friends,” he was close to his personal physician, Dr. Henry Jennings of Indianapolis, who apparently prescribed that the millionaire spend his winters in Florida.  When Fairbanks continued to worsen as he approached 81 years, Dr. Jennings accompanied him by train back to Terre Haute.  Crawford died in his suite at the Terre Haute House in May 1924.  After a private funeral he was interred in the family mausoleum with his late wife and daughter, Sara, who had died in 1915.

Obituaries of Fairbanks ran in newspapers throughout Indiana and beyond.  One state journal hailed him as “Indiana’s greatest financial genius.”  Another reporter declared him “Indiana’s Richest Man.”  What too frequently was ignored was the original driving source of Crawford’s wealth and entrepreneurship — making and selling whiskey.  

Note:  The information for this article came from two principal sources:  An article of March 15, 2014, by Mike McCormick to the Terre Haute Tribune-Star and a Vigo County Library Historical Biography by Dr. Dipa Sarkar.