Interviewee: Walter Beinecke, Jr.
Interviewer: Sam Proctor
Date: July 9, 1990
P: I am doing an interview today with Walter Beinecke, Jr., and I am in his office in
Nantucket, Massachusetts. Walter give me again the street address.
B: 4 North Water Street.
P: This is Sam Proctor doing the interviewing and I am doing this for the University
of Florida Oral History Project. Walter give me the date of your birth, please.
B: February 20, 1918.
P: You were born where?
B: New York City.
[Tape is inaudible.]
B: The last time I looked there are still two companies in the Manhattan telephone
book that he founded both of which he sold over a hundred years ago. Beinecke
and Company and Beinecke Ottman Company.
P: Still operating under those names?
B: Still operating under those names. The first one he sold to Harmer and
Company, a major Chicago packing house, after it was successful, because he
wanted to go into the hotel business. He had learned a lot about hotels and
restaurants as a wholesale supplier. Those were his clients and he decided that
they represented bigger fields.
Digressing a moment, but a friend took me down a street in New York that I had
never seen, called Great Jones Street. On Great Jones Street, it is now a
parking garage, but it was built as a three story stable in the days when these
meat companies had a series of delivery vans, but all of which were horse drawn
in those days. It was a novelty to me; I had never heard of a multi-story stable. I
took it granted the horses would be kept on the ground floor. Even in those days
Manhattan was crowded enough. The building is still there and carved in stone
on the front of it is Beinecke and Company.
P: Presumably then, he is moving up the economic ladder.
B: Yes. He became, eventually, the proprietor of what, at one time, was described
as the largest hotel in New York, called the Manhattan Hotel. I think that was
almost a thousand room hotel.
P: Where was that located?
B: I do not know. I have seen references but I do not remember them. His great
success came later with the construction of the Plaza Hotel, which is today
considered one of New York's landmarks. That is at the corner of Fifth Avenue
and 59th Street.
P: And Mr. Trump owns it.
B: Mr. Trump or Mrs. Trump recently own it.
P: The banks may have foreclosed by now.
B: On Mr. Trump. Well, that stayed in the family until the Depression in the 1930s.
P: Did Mr. Beinecke build that hotel?
B: He built it. Well, he was the proprietor who nursed it through the architectural
and developmental stages. He was the operator of it for a number of years.
Then he merged it with a company called U.S. Realty and Improvement.
Instead of getting cash, he took stock in the realty company and became
chairman of the board of the realty company. In that form they built other hotels.
They built the Nacional in Havana, they built the Kopley Plaza in Boston and
eventually, in full swing, by which time he was an old man, they built the Savoy
Plaza, also on Fifth Avenue directly across the street from the original Plaza. At
that point my grandfather was in his eighties and he was still the titular head of
the board of directors but he was no longer active. He was opposed to the
construction of the Savoy Plaza. It was built in a wave of enthusiasm in the late
1920s when everybody thought everything was going to keep going up. But by
the time they finished it, the Depression had set in and my grandfather who had
moved to the Plaza across the street, sat in the window in his last years and
watched everything go. He ended up the way he started; he ended up broke.
But by then he was a happy man. He was eighty-six years old, he had raised
seven children, given them all good education, seen them have careers well
started of one kind or another. So in every way you would have to say his life
was a success.
P: Who did he marry?
B: He married a woman named Johanna Weigle. Although having a German name
she was American born, by then two or three generations. It is a German word
that comes from protestorr." Hence Protestants, her family were Protestant
missionaries in the Catholic part of Germany.
P: She was a New York resident also?
B: She was a New York girl.
P: How did they meet?
B: That I do not know.
P: And they had seven children, of which your father was the seventh, the youngest
of the children?
P: When did your grandfather die?
B: He died in 1932.
P: So you remember him?
B: I remember him. My privilege was spending Sunday dinner; in those days it was
at midday. I used to go to my grandparents for Sunday dinner and a drive in the
country. Which was a big treat when you grew up in New York.
P: And the country was not as far out as it is today.
B: My father never could understand because by the time I was an adult I did not
like New York. He would tell entirely different kind of stories about the city. He
had lived there all his life and loved it. He would tell me how, after church, he
and the other boys in the family would get on their bicycles and my grandfather
would take the carriage with his wife and daughters and they would drive to the
country. I asked what was their favorite spot. It turned out their favorite spot was
up near Spite and Diver where Columbia University now has its football field.
That was way out in the boondocks.
P: So your grandfather then was the man, together with his associates, who was
responsible for the Plaza Hotel?
P: And it passed out of his ownership at the time of the Depression?
B: Well, even before that one of his sons had become really the business
representatives in that part of the family affairs. But the family lost its equity in
the hotel in, I think it was just about the time of his death, 1931 or 1932. The only
thing that was saved out of that company that had been a subsidiary of U.S.
Realty, was called the George A. Fuller Company. The family kept its
connection with that and it actually kept its equity into the 1970s. The Fuller
Company was at one time the largest building construction company in the
United States. Not the largest construction, the difference is that they were
specialists in buildings, as opposed to highways, dams and things of that type.
But George A. Fuller, after whom the firm was named, was an architect from
Chicago. His partner was Louis Sullivan [1856-1924], the famous Chicago
architect. Sullivan and Fuller, a littler earlier than a lot of people, recognized the
distinction between the contractor and the architect. In those days an architect, it
was quite common for him to undertake the assignment of designing a building
for a client and then of building it for him. Sullivan and Fuller recognized the
inherent conflict in responsibilities. Fuller was more interested in the construction
aspects. They amicably severed the partnership. Sullivan, of course, to his
eventual fame remained the great architect of Chicago. Fuller developed a
construction company, first with offices in Chicago; later, New York became their
headquarters. He built the first high-rise steel building in New York. Of course
the big technical distinction is that buildings used to be masonry buildings--wall
bearing, the floors at every level rested on the outer wall. That form of
construction is limited to ten or twelve floors. It was the development of the steel
frame, where the walls are only a curtain and the weight of the building does not
rest on the walls, but on the columns and the frame of it. The Flat Iron Building
in New York was the first important example.
P: And Fuller built that?
B: Fuller built that. Because what that led to was the development of the sky-
scraper. The ultimate test was about 1940 when the army bomber flew into the
Empire State Building and killed a lot of people because it hit two floors that were
occupied. But the building, it really was a patch job to restore these curtain walls
and the fundamental building was undamaged.
P: The Fuller Company, of course, did not build the Plaza Hotel?
B: The Fuller Company did build the Plaza. In later years we retained our family
interest in it, even after we lost the Plaza. Because remember I told you a
moment ago that the Fuller Company subsidiary of U.S. Realty into which my
grandfather had put the hotel. So our technical position was we were
stockholders of U.S. Realty and when U.S. Realty failed in the Depression, we
kept the stock of the Fuller Company separately. Our association with that was
about sixty years. Because my uncle Edwin (I referred a moment ago to the
seven children), the three youngest brothers, Edwin, Frederick and Walter stayed
together all their lives. Not only socially, but in business. They were very, very
close and always worked together. They attributed a great deal of their success
and prosperity to the way they worked. Each one was a distinct person. My
father was really the sales type. Frederick was educated as an engineer and
was also a philosopher. Edwin was very much the business man. Edwin was
chairman of the Fuller Company for nearer fifty years than forty, having been
delegated that by his father at an early time. My father was on the board there
for many years and I served on the board the last fifteen years of our association
with it. During that period we built the U.N. headquarters in New York. We built
the first major glass skyscraper, which was Lever Brothers on Park Avenue in
New York. We built the first aluminum building in America which was the Alcoa
headquarters in Pittsburgh. We built the Seagram Building, the famous bronze
building on Park Avenue. That is not the sum of the assignments, but those were
some of the exciting ones during that period.
P: Am I right in believing or knowing that the Fuller Company also built the Lincoln
Memorial in Washington?
B: I am not sure of that. There was a period, during the 1930s and 1940s when the
company majored in what was called monumental building. In those days that
meant a great amount of government work. We were the only company that built
more than one state capital; we built three. We built Louisiana, Maine, and North
Dakota. We did build the Jefferson Monument. I am not sure about the Lincoln.
P: The Lincoln Memorial would have come much earlier.
B: It would have come much earlier and certainly was before my time. We retained
our interest in the Fuller Company until quite late and a wonderful man who was
president of it and had been associated with my uncle for forty years was a man
named Lou Crandall, a graduate of the engineering school at the University of
Michigan. When it became clear that both Mr. Crandall and my uncle were both
of a retirement age, and Crandall had thought at one time his son-in-law was a
potential successor and that did not work out, and Lou announced he was ready
to sell. The company by then was a publicly held company with stock in the
market but as a family we owned over half of the stock. My father was the first of
these three brothers, although the youngest, he was the first to die, in 1958, and
his brothers wanted something in the form of a memorial for him. Then my
generation woke up and said, "Well, we ought to do something in honor of all
three of them, while the other two are still here we can demonstrate our feelings
on it." We undertook, at that time, to build a library at Yale.
P: The Beinecke Library?
B: It is rather well known. It is known as the largest rare book and manuscript
library in the world. It is rather an architectural tour de force. The most obvious
thing is that only twenty percent of the library is above ground. There are three
stories which are both underneath the visible portion, plus underneath an
adjacent plaza. The walls of the portion that is built above ground are Vermont
marble, cut thin enough that it acts like stained glass. In the daytime when you
are in the building, you see the patterns of the marble, the sunlight coming
through. The material is actually translucent. At night it is the reverse. The
electric lights of the building show from the outside of the building.
P: It is a magnificent building. I have worked in that building doing some research.
Did you endow the library?
B: Yes. Well, the library has been a principal interest of the family for many years.
The reason that was picked as the project was that my uncle Edwin had a life-
long interest in that library. At one time he was chairman of the Yale Library
P: Had members of the family gone to Yale?
B: It is odd, Frederick, my uncle, was the only one in that generation who
graduated. Uncle Edwin left and went in the army in World War I, to Europe. My
father, he had a freshman year there, felt that that was too big and he would be
happier in a smaller town and he transferred to Williams. In my generation there
has been an active interest. I have several nieces and nephews who graduated
from Yale. My cousin Bill was not only a Yale graduate, but eventually became a
trustee of Yale.
P: Bill who?
B: Bill Beinecke, the son of Frederick. The construction of that building was the end
of our interest in the Fuller Company. By then, Uncle Edwin, who was chairman
of it for so many years, was in his eighties and wanted no part of business
anymore. Lou Crandall was retiring and I was the only family connection left.
What we did was, we paid for the library at Yale by giving Yale the stock and they
sold the company. It became a Texas company; it is still in business. The Texan
failed with it and he bailed out by selling it to somebody else. I do not know who
the present owners are. It is still in business; I see their signs occasionally.
P: Walter, what about your grandmother, did she have any impact on you?
B: My grandmother, my paternal grandmother, she was a very beautiful woman. I
have just been sorting out photographs for my kids and she really was lovely.
She was a wife of those times; she had no career in the modern sense. Her
career was her seven children, her home, and her husband. She and her
husband celebrated their fiftieth wedding anniversary together. Late in life, after
all the children were grown, she went back to what was a pleasure and an
important thing to her in her youth, which was the piano. I well remember her
attached to a piano, when I used to go visit her. She was flexibly minded
enough, at the very least as a mature women (maybe you would say an old
woman), when she went back to the piano she did it in a very thorough way and
took piano lessons again, which she had done as a girl. The piano meant a lot to
her. I can understand that because I have one daughter whose whole life is
music and being a music teacher. It was a big thing in her life, it was not just a
P: Were you a big thing in her life?
B: Well, obviously everyone would like to say yes, but she was fond of me. I cannot
honestly say that I was a big thing in her life; she had a lot of grandchildren.
P: How about your grandfather, was he an important person in your life?
B: He was important to me. I was the youngest grandson and I was closer to him, I
think, than the other grandchildren, which partly came of geography. My father
was the only one of their children who continued to live in New York and his
relationship with his mother and father was very close. I remember when I was a
young boy, ten years old or something, my father, at least three or four mornings
a week, we lived on the west side of New York up in the seventies and, as I told
you, my grandfather lived in the Plaza from the day it was opened. Dad would
walk down three or four mornings a week to have breakfast with his father and
then go from there to his office. They were very close. I think I had some of my
grandparents attention reflected from that relationship and related to the fact that
we lived in New York and I saw him more than their other grandchildren did.
P: What about your maternal grandparents, now?
B: Well, my mother's family were of Dutch descent. The name was originally was
Spirey and it became Anglicized to Sperry and they were settle in Virginia.
P: They came from Holland?
B: From Holland originally and there is a small town, Sperryville, Virginia on the
Virginia-West Virginia border.
P: Did you say they came during the Colonial Period?
B: Yes. One of her ancestors, Jacob Sperry, was in the group Morgan's Raiders,
who marched from Virginia to Quebec in their bare feet in the Revolutionary War.
A few of them got back and there was a group--you can still buy postcards down
there about the Dutch Mess, mess in the army sense that men that eat together.
The family drifted from there to Tennessee. The first one that I know of was my
mother's grandfather who was a newspaper publisher in Knoxville.
P: Give me your grandparent's names.
B: It was Jacob Austin Sperry and his wife was, I think, Rebecca Sperry; I do not
remember her maiden name. He was interesting enough that some of this was
written about and I have some volumes at home. His claim to fame was that the
Yankees threw him in the river. He was a newspaper publisher and he was a
Confederate. They threw he and his newspaper press in. Fortunately in reverse
order; I think the press went in and he was on top of it rather than under it.
Otherwise I might not be here. His wife left Knoxville on a Union caisson with her
newly born infant which was her--I have missed a generation. Jacob Austin was
her grandfather, my great-grandfather. So the man who was my grandfather was
Thomas Sperry and she and the baby Tom left on the caisson and settled in
Michigan, where she had kinfolk. Jacob Austin Sperry did survive being thrown
in the river.
P: It would have been her mother. That would have been your great-grandfather,
B: Right, my great-grandfather. He survived whatever happened to him after the
river and the rest of the war in the south. Eventually he joined his family in
Michigan and became a Michigan resident for the rest of his life.
P: Is that where the Sperry-Hutchinson comes from?
B: Yes. The baby that I am referring to grew up to be a man, Thomas Sperry, who
would be my grandfather who I never knew. He died before I was born; he died
in 1912. But he grew up in Michigan. He was a traveling salesman for a silver
company. He evolved the idea, what became the trading stamp business and
prospered exceedingly and moved east. Eventually made his home in Cranford,
New Jersey, with his office in New York. He died in 1912 leaving a widow and
four children, of whom my mother was the eldest.
P: She was a grown girl by that time?
B: No, she was seventeen at that time.
P: Was it an affluent family?
B: It was after Mr. Thomas Sperry's success, my grandfather. He built a very
successful company. The company was called Sperry and Hutchinson
Company. He founded it in 1894; it was incorporated in 1896. Mr. Hutchinson
dropped out in 1900. But he and Sperry had very different views of what it could
be in the long run.
P: What kind of a business was it.
B: It was a unique business then, and now it barely fits anymore. But the concept
was a substitute for a cash discount. The point was, it was customary at that
time in every channel of trade to give a discount for prompt payment; it was
called a cash discount. It was used at every level of trade except at the
consumer level. My grandfather matched that concept with the recognition that
the most money in the United States that changed hands was not big
transactions of a railroad buying a new locomotive or somebody buying a
building, it was purchases by women for food, clothing, and household services.
The economy of that time, the average transaction was a pretty small sum;
maybe a dollar and a half or a dollar seventy-five. A cash discount, in market
terms, was worth about two percent. Well, two percent of a dollar and a half is
not a great sum. You got to where fractions were a meaningful amount. If the
discount you were entitled to was a penny and a half, there was no such thing as
a half cent but what you were due was a third of your discount. So he evolved
the stamp as a way of paying the discount on every portion of your transaction.
They called it, in those days, the "ultimate discount." The idea was, you got your
discount in tokens, which you accumulated. When you had a sufficient number
of them you could redeem it for something. You could either redeem it for
something. You could either redeem it for cash or even preferably for
merchandise. Now, what he had to sell was that if he could get people interested
and offer a nice enough line of merchandise, people would consistently trade at a
store to get the stamps or token. Or as you got a little more modern, for
example, gasoline stations came into the picture. Well, the lady would say to her
husband, "Joe, I want you to buy the gas at that station. They give the stamps
that will help fill my book faster. I get my stamps at the grocery store and if you
will get them at the filling station, we will fill our book faster." So, the concept
from a commercial merchandising point of view was that he built a family of non-
competing merchants. The man in the department store, or the man in the
grocery store, or the man in gas station did not see themselves as competing
with one another. But they could benefit one another if one of them got people
saving the stamps so that it brought patronage to the other two, the merchants
were serving one another. Unlike most American businesses, it was a limiting
factor. Most American businesses are run on the premise that everybody should
be your customer, unlimited buying. Well, this kind of a service appeals and
serves a limited number. If there are three grocery stores in town, the stamp's
business is to take trade away from two of them and deliver it to the third. You
cannot sell all three of those grocery stores the same stamp because then none
of them are getting any benefit from it. The stamp is supposed to be an
inducement to go to a particular store. What you are offering the merchant who
is paying for it is that he gets a greater percentage of constant patronage by his
customers. The nearest thing that people would think of nowadays is gift
certificates. Maybe you give somebody a gift certificate at Christmas; I do not
know your taste in neckties but I want to send you a present for Christmas, so
instead of buying the necktie and maybe I had made a horrible choice, I go to the
department store and buy a gift certificate and send you the gift certificate.
P: And I can then buy whatever I want.
B: You buy whatever you want. Now, for the department store to successfully sell
gift certificates, they have to have a reputation for having an attractive enough
inventory. But they do not know until it is redeemed what you are going to
redeem it for. You may go in and buy that fancy silk necktie that I intended for
you; on which they probably make forty or fifty percent mark-up. Or you may
give it to your wife and she goes in during the January linen sales, on which they
make about ten percent. But if they wanted to continuously sell gift certificates
every year, they have to build an attractive enough inventory that people will
think it is worthwhile buying their product.
P: I did not realize that S & H Green Stamps went back that far in American
B: Well, in our heyday we had 20,000 employees and at one time we had almost
3,000 places of redemption; stores with inventories of merchandise. We used to
distribute 36 million catalogues a year.
P: Why did it go out? It has nothing to do with the main focus here, but I am
B: Well, what happened was we were a successful family business for three
generations with one lapse in between. After Mr. Sperry's death, the business
passed into the hands of a bank, his executor. It had serious problems, it came
close to failing, then the Beinecke brothers--the three brothers that I mentioned
earlier--bought the minority interest in the Sperry and Hutchinson Company and
then later were able to buy the controlling interest. They ran it as the Beinecke
family for fifty-six years, I think, but we were not able to happily make a transition
to the fourth generation.
P: It is interesting that it would start on the maternal side of your family, then move
to the paternal side.
B: That is how they met. When the Beineckes were minority stockholders, they met
members of the Sperry family and that is how dad met my mother.
P: Then the two families merged then?
B: Yes. But nobody in the Sperry family--my grandfather, his four children of which
my mother was the oldest (girls did not go into business in those days) and her
brothers were young children, so they never went into that company. The
Beineckes eventually bought out the majority interest. The bank in Chicago was
the executor for it. They ran it, but not very well. Beineckes had it from 1920
until 1978--well, maybe later than that, it is into the 1980s. I left it earlier than the
rest of my family because I wanted to be in business for myself. I did not go into
it until I was an adult. Eventually, I was vice-president in charge of sales. When
we could not stay into the fourth generation everybody agreed to sell. We sold it
probably ten years ago. Time goes fast. I take that back, it was more than ten
years ago, and the people that took it over failed completely. It was just one of
those American stories of a company, that at its height, it was about 800 million
dollars a year. I am talking about annual volume. The last I heard of it, it was
down to fifty or sixty million dollars. It was about to lose its last major customer.
P: Walter, let me get back to your father now; he was Walter Beinecke, Sr. What
business was he in?
B: He spent most of his life--I told you that these three brothers stayed together very
P: Each one did his own thing, then they did things together. That was their idea of
strength and independence.
P: Now, the things they did together was the Fuller Company?
B: That was one of them. My dad's principal interest was an insurance business.
That was called John C. Paige & Company. Paige in New England, he got
associated with it in 191 or 1912. He was a young man; he was the treasurer of
the Copley Plaza in Boston. He met people in Boston and liked them and they
liked him. Mr. Paige had long since died. Paige was over 100 years old in
Boston when Dad first associated with him. They set up a partnership to use the
same name in New York. The Boston partners collectively were a fifty percent
partner with the New York operation and Dad was the other fifty percent. He
worked at that with a brief interruption with the army in World War I. He worked
at that from about 1911 until 1956 when he had to retire for health. He died two
years later. That was always his principal business. When he and his brothers
acquired the Sperry and Hutchinson Company, Edwin became the full-time
operating head of Sperry-Hutchinson. They always retained an interest in the
Fuller Company. At one time they had a major business called the Patton
Scaffolding Company. Edwin was in the Army Engineers in World War I and
when he was on his way home he was routed through London and Regent
Street, that beautiful parqueted, the curved street coming out of Piccadilly Circus
had been bombed by a zeppelin. Britain does not have much timber, so they had
to evolve a different form of scaffolding. The first time that Edwin saw the
scaffolding on Regent Street and it was tubes, like pipes. The patent was a
device that could accept two pipes at any kind of an angle and clamp them
together so that you could build scaffolding that could be cantilevered out or that
could be crisscrossed around a church steeple or anything else. He bought the
American rights to that for, I think it was 1,000. He brought that back here and
the three of them set up a scaffolding company and for a few years it did not
amount to much. Then in 1929, the Sherry Netherlands Hotel in New York on
Fifth Avenue and Sixty-first was under construction. New York experienced a
hurricane at the same time that the Sherry Netherlands construction job had a
fire. They had these burning planks being blown off a thirty or forty story
building. New York drastically revised its building code and outlawed wooden
scaffolding, which became a great thing for their company. For many years they
ran that company very successfully. Then in the 1960s a major New York
politician, a man named Gerosa, was controller of New York. His brothers were
in the construction business. Their interest was in construction cranes. They
were successful in lobbying a change in the construction regulations in New York
and you had the period of truck mounted, flexible cranes with booms 150 and
170 feet long. That was a cheaper way of doing things. People would argue
whether or not it was better, but it definitely was cheaper. You just drove a truck
up and lifted things up to where you wanted them. The penalty was that you had
a certain number of accidents because you have that crane that amounts to a
lever and the lever 150 feet long mounted on a truck has tremendous leverage
against the base. The attack on them usually is on the safety base. Now you
see these modern Dutch cranes which are fixed, they are not on a moveable
base, but they stand as a tower. They have these long booms at the top, but that
is the more modern technology. They ran that company for years. Another one
they got excited about was, remember I told you they were three very different
guys--a salesman, an executive and a--
[End of side Al]
B: Uncle Edwin, the eldest of the three young Beinecke brothers, was vice-president
and purchasing agent for U.S. Realty and the Fuller Company. My father had
started his career as an insurance broker in New York. Frederick was an
engineer working for Texaco. He put in the first truck fleet. Fuel was delivered
(mostly in those days it was oil) in horse drawn vehicles. He put in the first fleet
of Studebaker trucks for Texaco. Those were the careers the three were
following. They were all young marrieds and ambitious to find things they could
expand into and preferably something they could do together. And the two of
them sat the engineering brother, Frederick, down and said, one thing they saw
happening was that people were building high-rise apartments and offices all
over New York and there was only one company that made mail chutes. That
was called Cutler Brothers from Rochester. The Cutler mail chutes were a
monopoly. They thought there has got to be a real opportunity there, the market
is expanding enormously and something ought to be done about it, so they set
Frederick to work to develop an improved mail chute. Now it is really a very
simple thing. A mail chute, essentially, is a hole in the floor in your own building.
But it is surrounded with government regulations, postal office regulations--at
least it was in those days. The regulations are very different now but, at that
time, a high percentage of mail chute had to be glass, from floor to ceiling, so the
postal inspector could walk through a building and make sure that the mail was
not being diverted anywhere. Then for practical reasons, a higher percentage
had to be capable of being opened so the inspector could check inside the thing.
Well, what this gave you from an engineering point of view was very long flimsy
door. If you had twelve foot ceilings, which were common then, you would have
a door twelve feet high and a foot wide and a fraction of an inch thick so it could,
what a mechanic or an engineer would call rack--it could warp in effect. So,
Frederick's contribution was he came up with a device something like the
hardware that you see on French doors where you turn one knob, but it
motivates movements at several points up and down the length of the door. He
devised this improved hardware so that the door latched at more than one point
and got a patent on that. So, they set themselves up as the American Mailing
Device Company. Then they went to war with Cutler. The first few years, every
time they would bid on a job, Cutler would sue them for patent infringement; in a
different state each time. Well, they won all the suits because their patent was
distinctly different and legally valid, but they went broke winning lawsuits. Mr.
Cutler had them on the ropes; they won in seventeen separate states. Then my
father made his contribution, he said, "This is silly. Patent infringement is a civil
suit and we have to defend it ourselves, or prosecute it ourselves. What we
should do is find something where somebody else pays the lawyer." So they
thought about that and what they did then was they recognized that anti-trust
suits, of course, are criminal suits and the government prosecutes them. So,
after that, every time Mr. Cutler sued them, they would file a counter suit on
restraint of trade and under the anti-trust or monopoly laws. The government
would pick up the case and chase Mr. Cutler. So, Mr. Cutler got tired of that after
awhile and then for awhile they just chased each other price-wise, so, nobody
made any money. Then Mr. Cutler said he would like to meet them. Well, they
were smart enough not to go, but by then their business was big enough they
had a very good man, Phil O'Neil, who was their treasurer, who I knew years
later. Mr. O'Neil told me he went up to Rochester. And the Cutler brothers, one
was the mayor of Rochester and the other ran the family business. He was a
generation ahead of the Beineckes I am telling you about. In other words, two
generations ahead of me. Mr. Cutler who received him was dressed in a frock
coat with a stiff winged collar and a roll top desk. O'Neil came in and he said,
"Mr. O'Neil, you men are ruining the sanctity of the mail chute business." O'Neil
said, "Mr. Cutler, I do not understand what do you mean the sanctity of the
business?" Cutler said, "Look, somebody is going to build an office building. We
do not tell them we would give our right arm to get the contract. We tell them we
would be glad to study the blueprints and see if a mail chute could be included.
We do not tell them that the only factor is a government regulation that says the
box at the bottom of the chute has to be within fifty feet of the curb because the
government does not want to pay postmen walking all over private property. So
we get the blue prints and make them move it, even if it is only six inches, just to
make it look hard." He said, "After it has been in for awhile and a screw falls out
of the hinge of the door on the fourth floor, we do not say, 'Send your janitor
down to the hardware store and buy a gross of screws for thirty cents.' We send
them a telegram, collect if you please, and we say, 'Remember, it is the federal
postal system you are tampering with and our factory trained mechanic is on the
way at 'x' dollars a day.' That is the sanctity of the business." Well, they got out
sanctified. Because what happened, eventually, they merged Cutler and
American Mailing Device under the name Cutler and we ran it until the end of
World War II. During World War II we made shell cases for the army because
essentially, at that point, the business was a foundry business because the mail
chute is just sheet metal knocked through holes in the floor and the fancy thing
was the box in the lobby. Owners would want very fancy bronzed boxes with
their initials cast in it or an American eagle or some suitable emblem. But they
had that business for a long time.
P: Where did the Beineckes get their investment capital, the three brothers?
B: Well, the idea was to scratch and do things that did not take a lot of capital. They
built up capital.
P: Their credit was good at the bank?
B: Well, increasingly it was, because they had successes. We had downs, too. I
have stayed in the pattern. They made a lot of money, there was a period when
they lost a lot of money. I remember when we moved out of the house. They
came and took the piano and my mother and father moved into a hotel. Now-a-
days it is a fancy hotel. At that time, they gave my father and mother two rooms,
because they could not pay my father's bill; they owed him a lot of money for
insurance. I went to boarding school because they only had two rooms. They
and my sister stayed there and I went to boarding school.
P: So the wealth that your grandfather had accumulated he lost and did not pass on
to his sons.
B: Well, he passed on things that were better. He passed on spirit and brains. I did
the same thing, I made a lot of money and, in 1970 I went belly-up. Lost it all.
P: But your grandfather never recovered. He was in his eighties so he live out his
remaining days in the Hotel Plaza lobby.
B: Not in the lobby, they had an apartment on the ninth floor, I think.
P: Well, he went downstairs for the excitement. Or into the Oak Room Club for a
sherry. Your father, then, Walter Beinecke, Sr., how long did he live?
P: What did he die of?
P: Was he successful, then, all the rest of his life. And he stayed close to his two
B: The three of them together, until Dad died. The other two stayed together then.
P: What did your father pass on to you, other than whatever money he did, what
was his influence over you?
B: Even now that I am in my seventies, I look back and I still try to evaluate. The
first important thing that he did for me was that he figured that I needed a kick in
the pants. He gave me a one way ticket from Massachusetts to Oregon and fifty
P: Why did he do that?
B: Well, I know now, which I did not know at that time, that he was absolutely right.
I was spoiled and undisciplined, I was in school. I was never so bad that they
threw me out, but I was perpetually on probation because I did not work.
P: Well, he did this when you were a young teenager, did he not?
B: I was fifteen.
P: So how could you have turned so bad in fifteen years?
B: Well, I do not know that I turned so bad, I was just negligent; I did not work.
P: Now, you grew up in the 1920s in New York.
B: There were some interruptions. We lived in Europe for a year and I went to
public school in France.
P: What were you doing in Europe for a year?
B: Well, Dad was working. His idea of the insurance business was the reverse of
most people's. He did not think it was hard to get customers, thought that the
problem was that a lot of people did not know how to get insurance. He spent a
lot of time working with particularly English insurance companies and also some
continental ones so that when he came back to this country, he had an expertise
and he specialized in handling big corporate accounts that the average broker
did not know how to cover. For example, the maritime insurance and major
industrial risks that have to be reinsured. Even in those days, big business was
too big for one insurance company to be willing to--for example, one of his
customers was Colgate, Palmolive, Peet who had plants in many different places
and no one insurance company would cover them all. But the client wanted one
policy so it took somebody with special insurance contacts and insurance
technical knowledge to be able to put together a group of reinsurers. So one
company would finally be the name on the policy, but they would have laid off the
risk with maybe twenty other insurance companies. Most people approach
selling insurance by going out and seeing how they can find customers, then they
sell whatever policies you can get off a shelf. But that is not adequate for big
business. What he did was specialize in serving big business by having, in
effect, better relationships with, if you want to call them suppliers, than the
ordinary insurance broker.
P: Walter, who were your siblings?
B: I have only one, I have a sister and she is still alive.
P: What is her name?
B: Well, on her birth certificate it is Catherine Elizabeth, but the day after that she
became Betsy and she has been ever since. She was married as Betsy, she
went to school as Betsy, her passports are Betsy.
P: So you two grew up, then, in New York, except for one interlude in France. Were
the Beineckes rich enough and important enough to be part of New York society?
B: They were rich enough. I think I am reacting to the way that you asked that
P: I am really asking from the historical point of view.
B: Well, my mother and father led a very active social life and with names, some of
which you would recognize. They were not in society the way that phrase seems
to be used now, kind of an artificial society. My sister and I did not go to
debutante parties and stuff like that. That was a matter of taste and family, what
would I say, culture.
P: You were born in 1918, so you were a young child growing up in New York City.
Did you go to the public schools?
B: No, I went to school in France for a year, then I went to a boy's prep school--that
is another thing that I do not agree with anymore--I went to boys classes from
kindergarten. I never met a girl until I was at work out in the world.
P: You went to school in New York City, other than the period in France?
B: Yes, until I was about nine or ten, and then I went to Massachusetts to a boy's
P: Now, tell me about this fifty dollar bit and the trip to Portland.
B: Well, he gave me a ticket to Portland and said, "See how far you can go." I went
to Japan and China.
P: How did all of that come about suddenly? That is a pretty dramatic thing for a
father to do to a fifteen year old.
B: Well, it was summer time, or summer was coming on when we talked about it. I
said that I wanted to go to work. He said, "Well, go see what it is like."
P: So, he encouraged you when you said, "I want to go to work.
B: Yes, very much so. It was a good thing because at school I consistently had
reports that said I was as bright as anyone else, but that I was utterly
undisciplined. If a teacher was teaching something that interested me, I would
do pretty well at it. If it did not interest me I would not do it at all. I did not get a
marginal mark, I would get a failure, completely.
P: How do you figure you were so undisciplined and so spoiled and so rotten?
B: I do not know.
P: Was there no discipline in the home?
B: Well, there was not much of that kind of discipline. I think my father's attitude
was that he expected me to be bright, because he thought most of the family was
bright. When he got these kind of marks from school, I think his first reaction was
that the school could not be doing something right. Then when he decided that
something drastic was needed, this was his approach, to see something of the
P: Where was your mother?
B: Well, my mother was a woman, I guess of a type that you really do not see of
anymore. She had no interest at all in almost anything except my father. I
always knew she loved us, but she was at my father's side all the time. She had
P: Hardly any time for her children?
B: I guess she always had time if we asked for it. I have no impression of being
denied that way. But, Betsy stayed much closer to my mother than I did. I told
you the one wrench that we had was in the Depression. My parents went from a
very elaborate living scale to a very modest one. That is when they thought it
was easier to send me to boarding school than any of the alternates that faced
them at that time.
P: It is obvious, though, that that did not cause any collapse of the two. They
adjusted themselves to the changed circumstances.
B: Oh, no problem. We had silly things happen. They lived on a very fancy scale.
Dad would call home at 5:30 in the evening and say, "Katie, I want to bring some
men home for dinner tonight." She would say, "Well, how many?" He would say,
"Six." So she would say, "All right, I will have it arranged." She kept a cook and
a butler and they had to run a house that flexibly. The butler came to my father
the day after they closed the house and said, "Mr. Beinecke, I have saved up
some money while I have been working for you and I do not know what to do with
it. I would like for you to take it because I am sure that you will get everything
back on track." This is the day after Mr. Roosevelt closed the banks and he
wanted to lend Dad his $10,000. Dad did not take it. They had a chauffeur and
he gave the car to the chauffeur because he could not afford to run it anymore
and he gave the chauffeur something so he could go into the taxi business. My
mother went back to hands on housekeeping, something that she had not done
for years. She went to an old German butcher that she had used as a bride and
he was very frosty. She was kind of amazed, she thought he would be pretty
nice. Here she was coming back ten or fifteen years later, whatever it was. He
was quite frosty, but he served her. Finally as she was ready to leave the shop,
the first time she went in in this post-Depression role, he said, "Mrs. Beinecke,
you know, I bet you think you gave me up?" Mom said, "Well, yes I did, Mr.
Shultz. We moved from the west side to the east side and it was not so
convenient anymore. I did think we gave you up." He said, "Well, you did not,
maybe you do not understand. When your butler used to come here and order a
seven rib roasts for your house and then he would require that I send the three
rib roasts to his house, I could go along with that. That is the way people were
doing things in the twenties. Then when I had to send a two rib roast to his
mistress' apartment, I could not take it anymore."
P: No wonder that butler felt that he owed your father something.
B: Well, it is a good thing that balloons get pricked once in a while.
P: Let us go back to this trip to the Pacific coast, was that looked upon as an
B: I think I looked on it as an adventure at the time; later I looked on it as a lesson. I
still do today.
P: I say you sit here now with the retrospect of I and think back on that situation.
But this is 1933 and you are fifteen years old, the height of the Depression, you
are given fifty dollars. There are not many jobs available for a fifteen year old kid
with no education.
B: Well, there were then if you were big enough to do the work. You got a job at
thirty dollars a month, plus your food, which was lousy. You had to buy your
uniforms out of the thirty dollars.
P: What are you talking about the CCC camps or something.
B: No, I was in what was loosely called the merchant marine. I was a seaman.
P: You went from New York to Portland on the fifty bucks that your father had given
you. When you got there, then what?
B: I signed on a ship.
P: That is what got you to the Orient.
B: It was a real crummy ship. You are an historian, do you remember the [S.S.]
Morro Castle [burned off the coast of New Jersey and beached at Asbury Park,
September 8, 1934]. That was a famous cruise liner that had been wrecked the
year before off the coast of New Jersey and burnt. It had all sorts of scandalous
stories about lifeboats with thirty crewmen in them and no passengers. The
captain had died eight hours before the ship was wrecked. There was always
some mystery about it, whether he had been murdered or what it was. That crew
were kept under some legal regulation on the East coast for many months for
governmental hearings and so on. They all got out about the time I went on this
ship. There were probably twenty of those men that came as a group on the ship
that I was on.
P: Do you recall the name of your ship?
B: Yes, it was the U.S.S. General Grant. It belonged to the thing called the State
Steamship Company which was headquartered in Portland. They had two one
class liners, the Grant and the General Lee. The chief economic factor for them
was they had contracts for maintaining American army supplies in the
Philippines. What that meant to us in the crew was that a major feature was we
had refrigerated holds for the meat and fruits that were taken out to the troops.
Of course the great thing was when they loaded the fruits, every so often they
would deliberately drop a case, to break it open, so that we would have a little
dividend. I am sure that it was part of my plan because looking back at it, the
whole thing was sort of--it was an administered shock. First off, the American
seamen at that time were at the lowest level of American society, even in the
Depression, thirty dollars a month was pretty lousy. The American ships were
not subsidized the way we have maritime acts and so on today. The result was
that an American shipping company was competing against the rest of the
shipping companies of the world on a direct basis, with no subsidy. So that to
pay their men thirty dollars a month, which was lousy by American standards,
was still tough competition because they were competing against somebody who
had a shipload of Chinamen or Indians who we paid eight dollars a month and a
bucket of rice. So you did not have a very admirable level of people and it had
not been unionized then. The great union movement came a year later. Harry
Bridges was the famous union leader on the West coast. They had the general
strike and tied the whole West coast up to attack the shipping industry and
everything else that he could get into it. But, for me, at fifteen you are out being
a man and you are going to keep up with everybody. All the way across the
Pacific I am listening to these fellows, "What a wonderful time we are going to
have when we get to port." Well, we got to port and I thought it was pretty lousy.
We went to some crummy barroom and had Japanese beer. I had no hang-up
about liquor because my mother and father were the type that--like when we
lived in Europe they would put a little wine in my sister's or my glass and spike it
with a little water or visa versa, they would spike or water with a little wine. But at
least we had something colored when the grown-ups did. So, there was no
P: Prohibition was not part of your day to day household.
B: No. But when I got exposed in this barroom, I did not understand what was so
exciting and I had to leave earlier that the others.
P: Wine, women, and song did not make much of an impact on a fifteen year old?
B: It made a big impact, but not the way you think. Because at sea I was on lookout
duty from twelve to four at night. In port the lookout person stands gangway
watch to control pedestrian traffic onto the ship. So, I had to go back at twelve
o'clock. I am standing there, I am thinking four o'clock will never come. That
beer had tasted terrible, I had butterflies in tummy and little men with hammers in
my head. About three-thirty two men come walking up the wharf--they were
about as drunk as they could be and still walk--and they headed for the ship. I
knew them both. One of them was the man who had the bunk underneath me.
They saw the ship at the end of the dock and they did not bother to look for a
gangplank, they just reeled toward the ship and went right over the end of the
dock. Well, one was lucky and went into the water, the other one was killed. He
had bounced back and forth; hit his head on the ship. You know they are only
eight feet apart. He bounced off the ship and the dock and was dead by the time
he hit the water. I am up there ringing alarm bells and screaming and being sick
to my stomach. I did not take a drink for between twenty and twenty-five years
after that. So, if there was a lesson to be learned, I learned that lesson by
osmosis. It was pretty expensive for the guy who taught me.
P: Your father's fifty dollars went a long way, it seems to me.
B: Well, other things happened. We got to China and my kids do not believe it.
They think slavery died with Abraham Lincoln in our civil war, but I saw people
sold. I do not mean girls rented for a night, but I saw Chinese people sell
daughters for twelve dollars; not American dollars but Hong Kong dollars which
was about fifty cents our money. I saw people dying in the street. I saw people
clubbing each other for food and the food was a dead cat floating down the river,
but it was meat and that they were living that marginally. I did not realize it at the
time, I did not articulate why Dad did it or anything, but looking back I think it was
his counter action to having concluded that I was spoiled and that I ought to have
a different set of values and see things differently.
P: Of course he did not realize that you were going to see life quite so crudely as
this, because he had never traveled to that part of the world himself, had he?
B: He had been to Japan. He had been to the Orient on business, not on the kind
of level that I was dealing with. I mean as a seaman in foreign ports. I am sure it
is the same today for a seaman coming to New York) you did not see what
people like to think is the exotic part of it. The first time I went to Hong Kong we
were unloading Ford chassis and the Chinamen, they would swing them up out
of the hold and the crane would lower them onto the dock and the Chinese
coolies did not know enough how to steer one; they had no gas in them because
they would not allow that on shipboard so they had to be pushed the length of the
dock. But one of the American seamen had to ride each one to steer it while the
Chinamen pushed it down to the parking lot. That was all I saw of Hong Kong
first time around, I got back there later. I was very intelligent. I sent my mother a
postcard from Manila. I thought this is about as far as we will ever go, or, at least
as far as I will ever go. I always sent Mom a postcard. We were about to sail, so
I rushed ashore and mailed a postcard right on the dock. I was so smart that it
was only three days later that I woke up that we were the mail ship. In those
days there was not any such thing as airmail, everything moved in the ships.
The Manila schedule to the West Coast a week, and we were the ship. That was
my last trip, I got home before the postcard did.
P: How long did this trip take?
B: Oh, I was gone about eight months, and I walked in the house. My mother was
delighted to know I was still alive, then she remembered how mad she was and
did not talk to me for two weeks.
P: It caught up with her. Okay, let us move on from there. So, in 1933 you were in
the merchant marine and you come back and you are almost sixteen years old.
Why did you not proceed with your education?
B: I went back to school. I was in a fancy prep school in Middletown, Rhode Island-
-St. George's school.
P: Is your family recouping a little bit so they can afford to send you to the prep
B: Well, Dad borrowed the money from a dear friend; I knew him for the rest of my
life. I went back to school but by then Dad was recouping because we were
moving on into the middle 1930s. We are digressing about how he recouped--he
recouped mostly in the insurance business. You might be amused at some
stories out of that. He had two partners, one of whom he had almost from the
beginning: Hamilton Fish, Jr., a Republican Congressman who was anathema to
Roosevelt [Representative from New York, 1919-1945]
P: Very far out to the right according to Mr. Roosevelt.
B: Absolutely he was.
P: And he was the grandson of Grant, Secretary of State.
B: And now his grandson is running for congress. It is a family with a distinguished
record that way. But the Mr. Fish that I am speaking of was a partner in Dad's
firm. Dad had taken him in a few years after the firm was founded. Then in the
1930s they took in Jimmy Roosevelt, the president's eldest son.
P: Boy, that was a combination.
B: Well, that was the kind of thing my father could do. He could balance people. I
told you he was a salesman.
P: Beinecke, Roosevelt and Fish.
B: Well, there were other partners, too, by then. You talk about Mr. Nixon's black
list and stuff like that, Mr. Roosevelt had one. The IRS [Internal Revenue
Service] used to come to his office once a month trying to trip up Mr. Fish. That
stopped when Jimmy Roosevelt came into the office.
I have always thought what a wonderful soap salesman Mr. Roosevelt would
have been because my mother was a woman who took all her feelings by
osmosis. If Dad liked something, she loved it. And if Dad just really did not care
for something, she hated it. But whatever were his feelings, multiply it by ten or
twenty and that was her. Dad was a Republican so she was convinced that Mr.
Roosevelt must be very close to the Devil.
One year they were going to Florida (you went on the train in those days so they
were going through Washington) and Jimmy Roosevelt insisted they should have
to stay over in Washington overnight and have dinner with he and his wife and
his mother and father. So they went and had an intimate dinner at the White
House, just the six of them. My mother was seated on the President's right and
at the end of the meal he offered her a cigarette. She said, "Oh, no thanks, I will
smoke my own." The point being, I worked in those days for Lucky Strike
(American Tobacco Company) and we saw that as a very competitive business
in those days. Then she was afraid she had been rude in the way she had
turned him down. So, she proceeded to explain to him, "I have to smoke Luckys
because my son works for them and he has told me that if he ever hears of me
smoking anything else, he will paddle me and I will have to eat my dinner off the
mantlepiece." So Mr. Roosevelt laughed and lit her cigarette for her and that was
the end of that.
Well, six weeks later they were coming back from Florida and again they were
invited to the White House, but this time it is a big affair. They went through the
reception line and said, "How do you do, Mr. President?", and had no other
conversation with him. Then as Dad said, they were seated way below the salt.
At the end of the meal everyone gets up and they leave the president seated at
the table, he was in a wheel chair by then. The assembled crowd would go up
the grand staircase to the room where they were to see a film. They left the
president at the table, but by the time they get up the stairs he has been whisked
up a back elevator or something. They come into the ballroom or whatever it is
and Mom and Dad are seated near the front, way over to the side. Just before
the film starts a butler comes over and bows in front of my mother and presents
her a silver tray with a pack of Luckys on it. The man is leaning over his tray,
bowing, and he is pointing to the side, like this. And Mom looks, the president is
beaming and waving at her and pointing down at the cigarettes.
P: He had remembered.
B: Well, I do not know, he must have a superb filing system. That is a salesman
stunt. If you have a prospect and you have talked to him, you write the sport that
he is interested in, the name of his children. Anything that gives you a little
entree or hint the next time you come around what should you remember about
the man. So he obviously must have had a superb filing system. The point was
my mother ended up the most confused woman in the world because she had
gone there fully expecting this man to be something that looked like the devil or
something, instead he turns out to be this charming soft soaper. She could not
P: Was it enough to switch her from the Republican Party to the Democratic Party.
B: No, it did not.
P: She continued to vote for somebody other than Mr. Roosevelt. Alf Landon and
B: It confused the hell out of her. Wendall Wilke was the first politician's funeral I
ever went to and I cried.
P: He was an important person in his day.
B: I do not know what you Southerners did? I guess you all voted for Mr. Roosevelt
just by the book.
P: Oh yes, everybody voted for Mr. Roosevelt because our confederate
grandparents and ancestors would have twirled in their graves had we voted for
a Republican. Southerners did not begin voting Republican until after World War
II. 1948 started the whole ball rolling. Some began to fall off the ledge a little bit
B: Well, I was a socialist when I was young, then I became a Democrat after I made
some money. I have never been able to get to be a Republican. But even as a
Democrat I could not go for Mr. Roosevelt's fourth term, that was too much.
P: Did you grow up in a religious household? Were your parents church people?
B: I would have to say slightly. My father's family still had a Lutheran background
and tendency and my grandparents did. But it diluted in my father's time. My
mother was of an Episcopal background. The school that I went to in Rhode
Island was one of the classic boys boarding schools, all of which were church
oriented originally, even if they were getting more and more non-sectarian as
time went on. I went to St. George's school and in those days, automatically the
Episcopal bishop of the state was chairman of the board of trustees, which is no
longer true. But neither is the school anything like it was. It is now co-ed and, I
think, much better.
P: Whatever the depth of your religious background, did it carry over into your adult
and later life? Are you a religious man, a church person today?
B: No, it left me very confused. I made some efforts--at school we went to chapel
eight times a week. When I got out of school I went to work in Europe and I had
a year of hiatus because I was living in Germany and really was not comfortable
enough in the society or with the language to take an experience like going to
church and not being able to understand what was going on. The next job that I
had was in Scotland and I attended the Church of Scotland for a year. I came
back to this country and was married and related for some years to the
Congregational church. Then I kind of drifted away from that.
P: It sounds to me, that even then it was kind of a casual relationship. Nothing that
strongly motivated you in the earlier years.
B: I think that is probably right.
P: Now, you led a pretty insulated life, I suspect, growing up, until you made this
move into the merchant marine which had to be a real culture shock for you. I
mean, in this environment that you were living in in New York you did not cross
B: Well, I was in boy's boarding school from nine or ten. Did you ever read Lord of
P: Oh, yes.
B: I mean you say it was cultural shock, the cultural level is, maybe not quite as
crude as it is among the seamen I described to you, but it is pretty raw.
P: When you go back to school, now, why did you leave and never really finish your
B: After, the merchant marine I did go back to school and had two more years of the
equivalent of high school. I suspect that I was better structured than before that
experience. I think that when I came back, I never said this at the time, but you
are making me interpret, I think I probably came back convinced that I knew
more about the real world than some of my classmates or that I was older
because of this experience. I stayed two more years. I did not graduate. I never
completed the academic requirements.
P: You never completed the academic requirements for high school, did you?
B: That is what I am talking about. Those two years would have been the last years
of high school and I did not complete them. My father said, "What are you going
to do?" He wanted me to go to college.
P: I would think there would be a lot of family pressure on you to have completed
high school and gone on to college?
B: Yes. I told Dad, "I am going to waste my time and your money if I go." I have
often thought about that.
P: Did he buy that argument?
B: He did eventually. The point was, I guess I was rebelling. Nowadays you would
call it rebelling. I do not think it was consciously rebelling.
P: You were not rebelling against your father?
B: No, I never had to. I do not think my father ever gave me an instruction after I
was twelve years old, or maybe ten years old. I always knew that I could have
his advice but I had to ask for it. I said, "Dad, here is my problem and this is
what I want to do." I could talk anything over with him but he never ran things.
"Ran" is the operative word. He never gave me orders, "this is what you have to
do" or "this is what are to do." When I left to high school he tried hard to get me
to go to college. I know now that in one sense my analysis and my decision were
correct. If he had forced me to go to college at that time, I would have piddled
away the whole experience. I was not properly motivated at the time.
P: Are you sorry that you did not?
B: I have regretted it many times since then. I have four honorary doctorates,
including one from your great institution, but I have not even got a high school
certificate. I did make attempts much later in life to go back to school. When I
was sixty, my business was very seasonal and I had an associate that was much
younger than myself, who I admired and respected, got along with well. I thought
he could run the business during the slack season and I will come back in the
busy season. At that time I was living in Williamstown, Massachusetts and I went
to Williams. I had a freshman year at Williams. Very tragically, my friend died
that Spring and that ended my college career. I thought I am sixty and I can take
early retirement half of the year and I will work the other half. During the half that
I am retired I can go to college. I had a freshman year and it was great.
P: But, it would only be an ego thing for you, because really with your travels, your
work, and so on you have acquired more than a college education, obviously.
B: Well, I have acquired some alternates to a college education, I am not sure that
you can say I acquired a college education. There are programs, nowadays, that
give you credits for life experiences and these various intangibles. But I have
looked back and I have not regretted the decision I made and what I told my dad.
I was right about that.
[End of side A2]
B: Well, I am saying that I wish had been a smarter guy or I wish I had been more
conventionally motivated. But that kind of thing has been part of my pattern all
along. I have never been a club type person. I could have made a conventional
American mistake and been so career or business motivated that I could have
spent my whole life like that. But I did learn enough to avoid that. The substitute
that I took instead of a social life was the volunteer system. That is something
that I am very prejudiced about.
P: Now, you went from school then, you take this job that takes you overseas, how
did that happen?
B: I had, I told you of the seven children of my father's generation, the second of the
seven was a woman who lived abroad; she lived in Germany. She married a
German in 1900.
P: This would have been your aunt.
B: She would have been my father's, considerably older, sister. She married--very
unusual woman and a story that modern American women do not like to here--
but in those days an American woman who married a foreigner forfeited her
P: Oh, I know--my mother had that same problem, so I know that.
B: So she was a German citizen by virtue of her marriage. In World War I she was
one of the very few people who was decorated by both sides. She was honored
by the French, Belgians, and Germans. She lived in Leipzig [East Germany] she
had married into a privileged family. By the time of the war, she had been there
sixteen, seventeen years, had children who were very Germanic. Her husband's
business had been owned in the family for 150 years and she was accepted by
sixteen years seniority as a member that family and into that society. But she still
had this little aura, because of her American upbringing, of being a little
mysterious to some of the people there. They saw her as the perfect candidate
for the international prisoners aide. She was the head of the International
Prisoners Aide in Germany during World War I and that was what resulted in her
recognition by these other governments. Her husband had died in the 1920s and
my grandfather tried to get her to move back to this country, but by then she had
been there twenty-odd years with four German children. She brought them up
bilingually, but culturally they were German, and German citizens. She said her
place was to stay there and hang onto the family business for them as they grew
up. She assured my father that she could get some connections that would get
me a job. So I had the privilege of spending holidays and weekends at her
home. I had not known them, but "blood is thicker than water." They were
P: So you worked for a German felt company?
B: I worked for a German felt factory.
P: Now what was that?
B: They made felts for pianos, hammer and damper felts for Steinway, Cronich &
Bach, and Baldwin.
P: Who got you that job?
B: My aunt had arranged it. Then eventually, after I learned some German, I got out
of the factory and traveled with the salesmen, in most of Europe. Scandinavia
was the first area I went to. Particularly up there, an educated businessman has
to speak more than one language. Almost without exception they speak at least
one of English, French or German, in addition to their own tongue. The
salesman I worked with was German by birth and he spoke German and French
fluently and a little English. But if we met a Swede or a Norwegian or somebody-
-we used to call on paper mills, for example--if we met a Norwegian who only
spoke Norwegian and English, which was a common situation, then I would
become sort of an interpreter. As a salesman I was an assistant, but in that kind
of a call I could act as the interpreter for my boss. I stayed there about a year
and a half.
P: You were there at a very tumultuous time, were you not, 1936 to 1937?
B: 1936 and 1937 and then I was ordered to leave. At the end of it, for the last four
or five months, I was actually being kind of a courier for taking things out of the
country. I traveled on the American student passport, so having a job was illegal,
anyway. I came back from a trip--you want to remember that the Germans were
always thorough, even if they were wrong--and they would try to amass German
assets in anticipation of the war. One of the things was deveischensteller,
currency control. German citizens had turn in anything that they owned in foreign
countries. In the beginning the German government treated the people, both
Jewish and non-Jewish, reasonably gently. They did not say they were
confiscating it, they said they were going to pay you for it. But if you had a
foreign asset you had to bring it and give it to the government. Well, of course,
what they did was just turn the printing press on, so that what you got was
probably worthless. But if you were a German and you owned something in
America, you were supposed to sell it. If it was stock or something else, you
were supposed to bring it back. The way the Germans enforced it was through
censorship of the mail. There was not much air mail in those days; it was on the
ship. German mail, unlike the rest of Europe, did not move on the next trans-
Atlantic ship, it moved on the next German ship. Part of the crew of every ship
were censors, so they did not hold up the mail unduly. That was their efficiency
to still put it on a crack liner, but there would be maybe six men on any of the
German vessels who did nothing but open letters and read it looking for
references to international trade. To get around that, for instance, in the felt
business we had a lot of Jewish customers and they were trying to get their
assets out of Germany. We would cooperate with them. A common thing, for
instance, we had a customer who made pianos. They did nothing for a year but
fill their export orders. They did not bother to sell anything domestically. They
shipped everything out of the country, at any price, just to get it out. European
business was very different than American business; it was not so impersonal.
There were generational relationships. The North American distributor of these
pianos was the grandson--he was dealing with the grandson of the founder of the
piano company and the two grandfathers had had the same relationship. They
had worked together on both sides for three generations so they trusted one
another. The German fellow got the message to his North American man, "I will
keep sending pianos but do not pay for them, put the money into a bank
account." In that particular case what they did--the family, in 1936, which was
very early for that--but this man was far sighted and saw what was happening.
He ran his factory for a year. The factory was in Berlin and at Christmas time
they went through all the normal motions. Historically, that place had closed for a
week at Christmas and gave all the employees a basket of some sort--in this
country it would be a Christmas turkey or something, I do not remember what it
would be--but they got a Christmas gift, shut the place down for a week and he
and his family went to the Dutch border. By then the Germans were already over
it against Jewish people. If they saw them going out of the country they would
suspect them of taking things and what not. So these people went very carefully
prepared. The women had no jewelry, they did not take any luggage. "What are
you doing here?" "Well," we said, "We are just going to go see grandma who
lives in the next town." They were searched and they had nothing, so they left.
Well, they had built up some assets out of the country. Now a lot of people
thought they were crazy, they left beautiful homes. They left several big and
wealthy people for several generations. They had homes with art and the
women had jewelry and furs and fine things and the factory. They were smart
enough they got out. A year later, they would have lost everything there anyway,
but they would not have had their lives or even capital to make a new start. Now
they made a new start--very modestly compared to the status they left.
P: But they had their lives.
B: They had their lives. But people like me were messengers for awhile.
P: What about your German family?
B: Well, they had already lost their home. They had a very beautiful property. As a
matter of fact, the interesting thing that I heard from one of them, there are still
some survivors, I heard from one of them last month. With this new Russian
relationship, there is a possibility that they are going to be given back the
property the Nazis took from them forty-eight years ago.
P: It sounds as though the family then was not pro-Nazi.
B: No, they were not. They were tarnished to begin with in that the mother was
American. I say American, I already told you she was not American legally, she
was American brought up and American cultured. At that time that was tarnished
in Hitler Germany. Her husband was fifteen years dead by the time she lost
everything. She was a responsible person.
Well, what I was doing was very nominal. I traveled on the American student
passport, so that I was not suspect and at that time they were still trying to get
along nicely with America. A year later I could have been in trouble. They
would give me some papers and I would go to some place like Rotterdam or
Hague, and I would be told, "You are to take these papers," and separately I
would have the name and address that they were to go to, and I was to mail
them but mail them on shipboard, just before you left. Every ship always had "all
ashore that are going ashore" and you went to see friends off, and then there
was a call a few minutes before they left. At that time I would go down to the
purser's office and mail the letter so that there was no chance of it getting back
into the German postal system. But what happened was I crossed the border, I
think it was about thirty-two times in the last five months and--they were always
very efficient--a foreigner in Germany at that time--you had to register with the
police once a month. Even as simple a thing as a foreigner cashing a check, it
would be stamped in your passport. They knew everywhere you had been,
everything you had spent. So, my passport was unduly ----tape glitch--- carry a
passport all the time. He said, "You go back and wait and register, you will hear
from us." I went back and forty-eight hours later I got a message to come down
to the police station. I was used to that; I went once a month.
[End of side B3; B4 is blank.]
P: We were talking about Mr. Hill.
B: He gave this pitch about "you have to toot your own horn." Then at the end, he
leans back, throws the thing in the wastebasket and looks at me and very calmly
says, "Well, that is all son." The point was, he had made a plan to impress
something on me. He waited until it was convenient and he had the props to do
it. One of the most famous stories that they used tell about him was he was the
first person to use fine art in a commercial ad. We had commissioned ten or
twelve of the best known artists in the country, at that time, to go south on
company expense for a month. Their assignment was to draw or record anything
about the tobacco industry that appealed to them. Out of the ones that came
back--I think there were three that were asked to work up some of their sketches
in whatever their own medium was, watercolor or oil or whatever it was, into a
finished work. Then they took one of those and actually went through the printing
process, had full plates made and everything. The staff all knew that Mr. Hill
would never look at anything but a finished piece. You could not show him a
sketch, you had to produce a finished work and then actually have it set up and
typed with the necessary commercial work added to it. And then tip it into the
magazine current issues as if it were actually a printed page in Life or Time,
which were the magazines we used in those days. Even in the dolor of the
[Break in tape]
B: I have seen him say, "What stupid idiot did that?" and pick it up and crumple it up
and throw it into the wastebasket. Well, I had a privileged status in that I was
one of the very few people who saw him outside of the office. I told you he had
his son live with me two summers and on rare occasions he would invite the son
and I to have supper with him. I got up enough nerve one time to ask him how
this worked. Because the advertising agency people used to go crazy. The
custom is you show rough sketches to a client and say, "Here is my idea." If the
client likes it he says, "Well, work it up a little." You then spend enough money to
have artists dress it up and you make dummies and replicas and things like that.
You approach it step by step. Well, Mr. Hill explained to me, he said, "Look, the
whole premise of advertising is iteration. When we have message we have to
keep hammering that same message so long we are almost crazy ourselves and
that is about the time people begin to hear it or begin to look at it. If we have a
good ad, I am going to have it in every magazine in America; I am going to have
it on every billboard in America." And he said, "I have to have impartial
judgement about whether it is good or not. If I sit in on the early sessions and
say, 'Well, the girl's dress ought to be pink instead of blue' or 'the gate ought to
be on the right instead of the left or shut instead of open."' He said, "I cannot
participate at that level and then pretend to have an unbiased judgement when I
look at it to make the final decision." So he said, "Sure, I am going to waste a
few thousand dollars this way, but that is better than wasting millions of dollars
on printing an inferior ad."
P: So, he was not stupid at all.
B: He was brilliant. But to the point that he was just so narrow minded that it was
very hard for other people to live with. There is a book (I will give it to you
tomorrow, I saw it the other night, I was going through some old stuff) about the
history of the modern advertising industry. The book is filled with references to
him, all of them written rather negatively, because the advertising executives--the
whole so-called Wall Street establishment--in the 1940s and 1950s was made up
of people who had worked for him. But he was ruthless. His concept of that pay
policy that I described to you meant that he thought he was entitled to your
absolute best efforts, but he owed you nothing except the fact that he paid you.
If somebody came along that could do it better than you, you were finished, he
took the new guy right then and there.
P: So there was no loyalty to you based service or your own dedication.
B: No, you had been overpaid by everybody else's standards. You had had a better
job than you could find anywhere else and for that you owed him the best you
could give. Because he wanted the best. But if you were no longer the best, if
somebody else came along who was better...
P: Is that why you finally left him?
B: No. I left him because he started to become ill in the late 1940s.
P: You leave around 1947.
B: Yes, and after the war he was in poor health. I began to see other things
happening. When he ran the place--I always described it as like a chain of
fishhooks--if you kept both ends under tension, it could stand the pull. You could
pull hard on it and it would be strong. But if you let any slack into it, it would all
fall apart. That is what the company was like. He set such a pace, there was no
room for slack. There were no departments that were maneuvering--like big
companies have a vice-president with a certain group of followers and another
vice-president has a different group of followers and they all are manipulating
who was going to be in power next year and so on. There was none of that when
Mr. Hill set the pace because he kept everyone moving so hard and so fast, or
completely out if they did not and with his illness it started to slack off.
P: So, you saw the handwriting on the wall?
B: Well, no. I said to myself, "If I stay here what can I be?" My colleague, there
were two of us sharing an office together, and fifteen years later he was
president of the American Tobacco Company. He and I were friendly
competitors; I had a shot at it. But I said to myself, "Well, if I stay here, what can
I be. Well, I can be president of the company. What is the president of the
company? He is a cigarette salesman." Well, I already was a cigarette
salesman. He was just a bigger and better one and an older one. Then I saw
the price that he paid and he had no family life, he had no friends, he just had
this absolutely maniacal fixation.
P: So the decision then to leave the American Tobacco Company was your
decision. You were not booted out and there was no single instance which
B: No, I decided wanted to look for something different.
P: Why did you not go into the family business, it was a big business by this time?
B: Yes, it was. Also, my father wanted me to go into the insurance business and
the joint family business that he ran with his brothers was also there.
P: The job opportunities were there and advancement was certainly guaranteed.
B: But I also saw something happen. I had a cousin somewhat older than myself,
Edwin Beinecke's son, who went to work for the family business. It was a
disaster for him and in a minor way for his father because Eddie went there from
college. The business was big enough that in addition to the three proprietors,
there were professional people. There were several vice-presidents, men of
caliber and substance in different functions in the company. When Eddie came
in, young Eddie, my cousin, the attitude of everybody was, "Is it not wonderful,
the family is going to carry on, the boss's son is coming in." But I got the
impression that behind the scenes was, "I hope they put the little bastard in
somebody else's department."
P: Well, it may have been because he was no good. But you would be coming in as
an experienced salesperson.
B: Eddie was bright, but he did not have outside experience. It ended up badly and
he left the company and he and his father were actually somewhat alienated for
awhile. So I had some distaste for going into a family situation.
P: Were you getting any pressure from the family to go in?
B: Well, Dad had suggested that I should and my uncles had indicated that they
would like it or that at least it would be acceptable. So, I had an opportunity--I
told you I had gotten my second promotion out of a urinal.
P: Yes, let's hear that. I got the spittoon out of the other.
B: Well, I had indicated to Dad I wanted to leave American Tobacco and look for
something different. I respected and valued Mr. Hill's leadership, but I had gotten
to a maturity where I saw that to achieve his position it was a price that did not
make sense to me. So, I was resigning. Dad was, at that point, the director of
the Graham-Paige Company. Graham-Paige was an old automobile company
that had stopped making automobiles but made automobile parts. They made
engines for other manufacturers. They made war materials and war equipment.
There was an investment group that decided during the war that Graham-Paige
would be a great post-war opportunity. You could take that company and
restructure it, go back into the automobile business and keep their old dealer
organization alive. He had friends in this investor group and they asked him to
be a director of it. One of the things it did--are we getting too far away from
things? It is a rather interesting story to people in American business because it
is a rather fascinating chapter.
P: I want to hear it.
B: Henry Kaiser [American industrialist, 1882-1967], the great West coast
industrialist, the Graham-Paige group had picked to be the head a man named
Joseph Frazier. Frazier had been, supposedly, the best automobile salesman in
the world. He had been vice-president of Chrysler. Of course, Chrysler built
tanks and they only had one customer. They made vehicles and tanks--
everything for the war effort. The government was the customer so they did not
need a vice-president of sales so Frazier was looking for a post-war opportunity
to line something up. He could have gone back to Chrysler, but the question was
could he get something where he would be a principal, not just a vice-president.
So, this group made him president of Graham-Paige. One of the things they did
was they concluded that there would be great opportunities on the West coast.
The differential in prices in of automobiles in Detroit as opposed to the West
coast was enormous because shipping over the Rockies was an expensive thing,
more than shipping to the East coast. So, they thought there would be a great
deal of surplus space after the war when the airplane factories on the West coast
were closed down. The thing to do was to line some of that up to be a West
coast assembly plant and they would prepare all of their parts in Detroit. They
would serve most of the United States with finished cars from Detroit but they
would ship some assemblies to the West coast and in this new cheap space
would finish them off and sell cars on the West coast with a favorable price
differential. So Frazier went out to California to see Giannini [Amadeo Peter
Giannini, American banker, 1870-1949], the head of the Bank of America (initial
A, I have forgotten what his first name was). A very famous man in San
Francisco and Bank of America was up and down the West coast. So Frazier
went to see him and he said, "That is a great idea, but one of my good friends
and clients has already got the same idea, that is Henry Kaiser. Why do you
guys not get together." Frazier went and met Kaiser and Kaiser's concern was
that he had never been in anything that had to be sold to consumers. His record
before the war had been major construction--things like the Hoover Dam,
highways, and bridges, steel. During the war he built for the government. His
big thing was the Liberty Ships. He even carried it to the point where they built a
ship in one day, just to dramatize the situation.
P: Big shipyards on the Pacific coast.
B: Yes. He was going to build, he had already had engineers design a car and he
was going to build a small car. His ambition was not to sell it all over the country;
he thought the Rockies isolated the coast and he had different strategy than
Graham-Paige. He was going to build his whole car on the West coast and only
sell it on the West coast. But he was concerned about the selling process
because they had never had any retail experience and how to build a dealer
organization, the service policies and everything that that would get into. So it
made sense for him to make a partnership with Graham-Paige. The deal they
struck was that Graham-Paige would make the Graham-Paige car, sell it
nationally and would also make a partnership with Kaiser and they would be
responsible for selling the Kaiser car, which would be made exclusively on the
West coast. But Graham-Paige would also do its business in sending sub-
assemblies for Graham-Paige cars. Under Fraizer's leadership they would
reactivate, which was a hard part of the job, the old dealer organization, many of
whom were still around. That was the plan and they started to put it together to
finance it. We it came to the end of the war and one of the big things was the
Willow Run plant. Willow Run was the big plant built outside Detroit where they
built bombers. It was built under a government program where a number of
companies during the war worked for the government for one dollar a year. One
of the considerations they got was the facilities that they built for the government,
they got first dibs on them. They had to pay for them, but they would get the first
opportunity to acquire it. Now that much is all fact, that I have told you. But
supposition has always been that the Ford company, at that time, had indicated
they were going to have a partnership with a Canadian company, Ford-
Ferguson. They were going to make tractors and farm machinery, after the war,
at the Willow Run plant. Well, at the last minute, Ford and Fergusen had a fight,
they did not bring about their plan for farm machinery and Fergusen walked
away. Ford, under the circumstances did not want to take on the Willow Run
plant, which was the largest plant in America that had built for the war. We then
had a War Surplus Properties Board (I think was the proper title of it) and they
had been bragging how they were going to dispose, advantageously for the
taxpayer, of this enormous plant that had been built in Detroit. When this deal
blew up, they were stuck with it. The first thing that happened was that the
automobile unions said they would buy it. That did not even last ten days; they
got sense, and shut up and backed down. So the Surplus Properties
Administration were stuck with this political white elephant and they went to
Kaiser and said, "Why do you not take it?" He had done this business of building
a ship in a day and demonstrated these wonderful abilities and so on. They said,
"You said you were going into the automobile business. Detroit is where it is
supposed to be centered; you take this plant." He said, "What the hell, I do not
need it. We do not need a fraction of it because I have got a partnership with
Graham-Paige and they have got a great big plant in Detroit. I do not need it."
Well, the politicians wanted to get off the hook, so the deal they made was, they
bought the old Graham-Paige plant from the partnership, made it into a
warehouse to store, because the government had a lot of extra machinery that
the government had paid for for different war plants. They just converted it to a
warehouse and stored all the machinery; that was the justification for it. But the
finances were that they gave the combination of Kaiser-Frazier-Graham-Paige
enough money for the old Graham-Paige plant, so that Kaiser-Frazier would turn
around and buy this new plant because the name on that one was important to
the government, whereas nobody cared about their buying a warehouse. The
money was the same. So, from being a modest venture, all of a sudden, they
were cast into a mammoth venture. It was lousy partnership. I got into it through
Joe Frazier, and that is where the urinal came, because they had a meeting in
New York at the Plaza hotel announcing their public plans, a big press reception
and everything else. I went down to the washroom and this guy came reeling in
and literally almost fell into the urinal. I pulled him out by his coat collar and
propped him up on the wash basin. So he cleaned himself up and went back
upstairs. As fate would have it, it was Mr. Frazier.
P: He had had a few too many martinis?
B: He had quite a few. He was sober enough to get my name and he knew my Dad
was the director of Graham-Paige. So about two weeks later I got an invitation to
meet him and to have lunch. He offered me the distributorship for Kaiser-Frazier
for New Jersey. Well, at that time this was a gift, I mean everybody was very
P: And you are still not thirty years old.
B: No. I had never been in Newark or New Jersey.
P: Was that a blessing? [Laughs.] I am teasing.
B: Well, I went to Newark and rented a desk in a real estate broker's office, just so I
had a place to sit and have a telephone. A year later I had 130 employees and
we were doing 12 million dollars a year. It lasted about two and one-half years.
P: When you left American Tobacco, how much were you making?
B: I was making $26-27,000 a year.
P: How much did you get for this new job?
B: Well, I was not working for the factory; I was my own boss. The system is
different now. All of the big automobile factories now sell direct to individual
dealers in each town. But in those days the big companies were just abandoning
the system. Kaiser-Frazier, as a new entrant, had to use it, and that was that you
used wholesalers. The appeal to Kaiser-Frazier was that a wholesaler was
responsible for finding enough capital to properly develop a given area. We had,
as it worked out, seventy dealers all over New Jersey and a few in eastern
Pennsylvania. The market was such that the established lines of cars, as they
began to come out with new--remember the nation had not had cars, you could
sell anything with four wheels. The Kaiser-Frazier cars and the Graham-Paige
cars were good cars and they were very advanced in design by the standards of
the times. They were the ones who took the cars beyond the step of running
P: They streamlined them.
B: They added to the width of the car what had been waste space before, the
running board space and they were very good mechanically. We had seventy
P: This was a great big opportunity for you.
B: Of course it was.
P: You came from a wealthy family, but you did not have any wealth yourself. You
had not made any big money at all. And you had come out of the army.
B: Well, I had lived awful well.
P: You had lived off it, I was going to say a salary of $25-30,000, even then, was not
giant. You were not living on Park Avenue.
B: But, I was doing awful well.
P: But this must have been a great opportunity for you financially and it sounds like
a great opportunity for you coming out of your sales background.
B: Well, we were overstretched. I had a wonderful associate, who was our
treasurer, our financial man. We turned our capital over more than once a week.
With automobiles, even in those days, the prices were enough that you got into
big bucks. Of course you did not buy the cars, they were what is called floor
planned. They were financed by companies that specialize in financing
automobiles. What their goal is, is to finance the eventual consumer, the final
buyer. As part of the process they also finance the dealer, because the
manufacturer has to be paid before the car leaves Detroit. In fact, technically, in
the automobile business, the car is paid for as it comes off the assembly line. If
you are a dealer who is going to have credit and have cars shipped to him, you
have to have credit in Detroit. That the factory, without any paperwork from you,
calls on your finance company and says, "I have three cars to send to," in this
case, "Beinecke in Newark." They get paid for them right then and there, as they
come off the assembly line. There is so much money involved in automobile
manufacture they cannot live waiting ten or thirty or even two days out of the
P: The days of Henry Ford's operation are long gone.
B: Yes, that is right.
P: Who is Edgar Kaiser?
B: He is the man that I admired the most in the whole thing. He is the son of Henry
P: Were you close to him?
B: Well, I got close to him in the process, because what I found as I stayed with the
thing was that, Frazier, in my opinion, was a crook. They had formed a
partnership with these people who had a wonderful experience and abilities in the
manufacturing business who had never had anything to do with sales. And
Frazier did, what I think were, if not dishonest, immoral things.
P: You said he was a super salesman.
B: He was a super salesman, but what he did--for instance, the partners left
advertising to him. They had never advertised anything in their lives and he was
supposed to be the sales hotshot in the automobile industry. He set up a
advertising agency that was proved to be later just to be he and his secretary.
P: So it was just a front sort of a thing.
B: As president of the automobile company he allocated, at that time I think it was,
like a million and a quarter or half dollars a month, which today is not much, but
then was. But it was to a business that he was the principal owner.
P: There is some collusion there.
B: Or conflict of interest. The policy was that Kaiser-Frazier was going to get the
financial strength of its cumulative its wholesalers. Your first criteria for picking
dealers, you had three criteria, really. You had to make sure they were people
that had some track record or prospect of being good sales people; they had to
be people who had the ability to do mechanical service; as part of a sales
function, the customers will expect service, and to stock parts and have
mechanics available and so on. Thirdly, they had to have financial resources
because the factory, its capital would be the cumulative resources of all its
dealers. So the wholesaler was supposed to put together a dealer organization
on these three criteria. The factory was going to keep the two strongest markets
for itself: New York and Los Angeles. But because they did not think they could
find anybody as a dealer who had enough resources to handle those big
markets, plus they would be very opportune markets.
P: But New Jersey must have been a mammoth market.
B: We ended up, we were the largest dealer other than the two branches, New York
and Los Angeles. But Frazier pulled the same stunt on New York and Los
Angeles that he pulled on the advertising thing. He setup dummy dealers in
which he was a major owner.
P: Was this what got you out of the automobile business, Frazier's manipulations?
B: Well, not really. It did in a sense because what happened was anybody who
could lay their hands on cars could sell them at retail right away.
P: You ordered them, you know, you put down payments on them even before they
B: That is right. If you had any of the early pre-war makes of cars, you went to a
dealer and you paid him, the phrase in those days was, "under the table."
Because we still had government price regulation. The factory could only sell on
the history of their previous prices plus certain acknowledged percentages for
inflation. But the market was that if a car that was, by law, going to have to sell
for $11,000 and you could get $13,000 or $14,000 and the salesman of the
dealer or his employer would get the money under the table. Our factory took
advantage of that; they were new. They were the only one that did not have a
pre-war history. So, under the government regulations they were able to set
prices based on their costs. What was going to happen in our case, if it was run
honestly, the factory was going to get that extra leverage and the dealer was still
just going to get the conventional margin. Then the difference came if you were
a wholesaler, did you play the short term goal. When the factory allocated cars
to your part of the country, did you keep more for retail for yourself or did you
take a long term position and say, "My goal is to build up a long term business
and I have got to have all of these dealers around here," and give them their fair
share of your allotment each month. Because you could sell more cars than you
P: With such a marvelous situation like this, such a sweet ordeal, why did you leave
B: Well, what happened was, in my opinion, I am sure there were other factors, but
the one that was obvious to me was that Mr. Frazier was taking all the short term
profits for himself and the factory was not getting them.
P: Well, was this leaving you holding the short end of the stick personally?
B: No. We could have made a lot more money if we had done it the same way he
did. But I believed of the long term thing. I got to be a great admirer of Edgar
Kaiser and I thought we were building for the long term. But then the long term
pooped out because the factory did not prosper enough, even with the extra
leverage of the current market, to have the kind of capital that they could go
through a model change. The history of the automobile business was that they
came up with new models every year, which even then meant several hundred
million dollars to the factory just to change the design and the tooling. After we
had been at it two and fraction years, I remember it was the third of March. My
father and mother were down in Nassau for the winter and New York had a
terrible snowstorm that almost closed the city down. It was like in 1888. I guess
this was in 1948. I had 630 brand new automobiles in outside storage in the
Newark railroad yard. Auto carriers were not as common then; the great deal of
new shipments from Detroit all went by rail. So, my place of unloading was the
Newark Railway Yards. I had 630 brand new automobiles in storage there,
because you had to take them when the factory made them, not by the sales
season. You had to take them when you could get them. So if I wanted to have
cars to sell when Spring came, I had to take them as they came out of the plant.
If you have ever heard of the case of frozen assets, I had the worst frozen assets
you have ever seen because New York and New Jersey had this five foot
snowstorm on Christmas followed by an icestorm on New Year's a week later.
All my cars were buried in these ice banks. We had bulldozers trying to dig them
out. I jumped on a plane and went down to see my dad. I said, "Dad, what do I
do? I have got the worst case of frozen assets anybody ever had. It is clear now
that the factory is not going to survive. They have not been able to make the
model change and they are going to disappear within the next year." He said,
"Well, what is the conventional wisdom?" I said, "Well, everybody else thinks
that the thing to do" (sales were much more seasonal then, you started selling on
Washington's birthday and you kind of pooped out by the fourth of July and then
you waited for the model change which came in the Fall). I said "everybody else
thinks the thing to do is get everything we can and sell like mad through Spring,
make a lot of money and then quit." He said, "What is wrong with that?" I said, "I
cannot because I am a wholesaler and I have got to give a lot of this inventory to
my dealers, we made commitments. I have to share the supply with them so I
cannot be a pig and take it all at retail. Also as a wholesaler, I have a big parts
inventory, I got $300,000 worth of parts. As long as I am in business, that is
$300,000 worth of parts. If I stop being in business, it is just junk, it is iron. I
have not got the vehicle to sell it anymore. Also, to sell 600 new cars, I am going
to end up with about 600 used cars, just old iron. If you stay active in business
there is a way of dealing with that, but," I said, "if I am going to quit that is a
problem." He said, "Bud, you are old enough now there is something to learn.
There are situations you look at and you have to say 'to hell with the cheese, let
me out of the trap"'. I said, "Thank you, Dad" and I gave him a kiss. I went back
and got on the plane and got back to New York that night. That was the third of
March, 1948. The third of April, I had terminated 130 employees. I had gotten
rid of three places of business: a major service garage and showroom and a
P: You were an active young man.
B: I had two employees left and they were working in the basement of my house,
putting the records in order so we could liquidate the thing. I was one of the few
that got out alive. We were the largest independent dealer and the factory still
thought they had a chance, so they took over the inventory. Another month later
they could not have done it.
P: So then what happened to you?
B: At that point, I still had contacts and ambitions.
P: Is that when you went to S & H?
B: S & H started to boom, enormously, after the war. My uncle Edwin had
come back from the war, that is a funny story. At the beginning of the
P: He had gone in?
B: He went in the Red Cross. When we were discussing the earlier generation, one
of the things that I did not tell you about (I told you they had interests in other
businesses), was my grandfather had started a bank, called the Germania Bank.
In the 1880s and New York had a heavy German population in those days, but
when you got to World War I, that was a lousy name. They change the name to
Commonwealth. Then in the 1920s the Commonwealth Bank was merged with
the Manufacturers Trust Company. At that time my uncle became the director of
Manufacturers Trust. He stayed with it for fifty years. So, he was the senior
director even after it became the Manufacturers Hanover Trust Company. They
kept that connection for years. When the Second World War started, the
president of Manufacturers was a Mr. Gibson. Mr. Gibson was Commissioner of
the Red Cross. He asked my uncle Edwin, because of his hotel background, to
come over as assistant commissioner for the Red Cross to set up the rest camps
and hospitals for soldiers. Uncle Edwin went over to do that, which was rather
surprising. When the war started, he was a man in his middle to late fifties. He
was not only head of Sperry-Hutchinson Company, which was a substantial
business, but with no war connection, he was the director of Curtiss-Wright,
which was the aircraft company, all war work. He was the chairman of the Fuller
Company which was all war work. We had exciting jobs then. I told you about
the foundry that came out of the mail chute business. In the construction
division, we built Quonset Point, which was the navy's main base on the East
coast for naval aircraft. The biggest single assignment, we built a city for 30,000
people in one year starting, I mean everything--sewer systems, hospitals,
chapels, barracks, residences, work spaces--up in Argentina, Newfoundland.
Because the technology, in those days was that planes going to the British Isles
could not make it non-stop from as far south as New York. They went up to
Newfoundland and then jumped across.
P: Now, Edwin leaves all of this, though, to go into service with the Red Cross.
B: He left all of that to go be assistant commissioner of the Red Cross in London; he
was headquartered in London. While he was there, Mr. Gibson had a heart
attack and had to retire and Uncle Edwin became chairman of the Red Cross
P: And he stayed there until the end of the war?
B: Until the end of the war. Then he came back and business started to boom. By
then he was in his sixties. So the family said well, there was nobody of my
generation in the business.
P: Edwin's son?
B: Well, he had been in and out. He did come back later, happily. I had a different
posture than my cousin. (I am getting out of sequence.) The point was, they put
pressure on me and said, "Now you have just closed your business, you are not
doing anything and you should not go look for something else."
P: Because they had not put the pressure on you earlier when you got out of the
B: No, I got by that. I made my own decision.
P: By the way, your sister's husband never becomes involved in the family
business, at all.
B: He came in later as a director of S & H.
P: But later, not in the 1940s when you were making the big transition.
B: No, that was not until the 1960s. But they said Uncle Edwin needs an extra pair
P: So you became it.
B: I became his legs.
P: What position did they give you?
B: Initially I was just an executive assistant. I used to travel five nights a week.
P: I saw that you were on an airplane an awful lot, criss-crossing the country.
B: Well, I do not know where you saw it but I did. I had one route; I was still living in
Jersey then. I would put the kids to bed Sunday night.
P: By this time how many children do you have?
B: Two, at that time. And I would go down to Newark and catch the night plane to
Portland, Oregon. I would work Monday in Portland, Tuesday in San Francisco,
Wednesday in Los Angeles, Thursday in Fort Worth and Friday in New York and
get home Friday night. I was in every office when it opened at nine o'clock in the
P: I cannot see that you had very much of a social life.
B: Well, I did not, but it was very exciting at the time.
P: Were you a workaholic? Were you, are you?
B: I was on the verge of it and the stupid thing is I had left American Tobacco
because I had realized the undesirability of spending your life like that. But then
when I went to work for my family...
P: But, this is a family business.
B: And it was more exciting and it was my family. Frying your own fish is more fun
than frying somebody else's fish.
P: Now S & H had to be more than just...
B: No, it was family.
P: No, I do not mean to say family. No, I am not suggesting that. What was it
involved with is really what I am asking?
B: We were not involved with anything else except our own business with
investments in certain other situations. The Fuller Company we still controlled.
The mail chute was a subsidiary of the Fuller Company. We had a major interest
in the liquor distribution and importing company called Austin Nichols. They had
things like, at one time, Heineken beer and Wild Turkey bourbon, Grant scotch,
things like that. S & H did not really diversify.
P: But S & H was more than just a stamp company, is really what I am asking.
B: It was almost exclusively a stamp company, during its most successful years.
P: That is when it was diverse enough.
B: In the middle 1960s they started diversifying and that was a mistake, as history
P: When you came into it, though, it was still basically a stamp company.
B: It was utterly a stamp business in its intents. It was a very unusual business and
very desirable from the owners point of the view. It was one of the few
businesses where you are paid nine months ahead of time. So that even if you
did not make any money on operations, you just made money on what was
called the "float." The fact that you were holding somebody else's money ahead
P: Why were you being paid ahead of time?
B: The main reason was, once we give the stamp out (I am saying this in the
present tense, this is all history), once you issue the stamp you have to be
prepared to redeem it at any moment. As a matter of policy we always
redeemed for cash if that is what the customer wanted.
P: Or premiums.
B: The point is, people talk about Americans as money grubbers, well, we can show
you seventy years of history of people preferring, if you do a good job of selecting
things, it is always easier to find something people liked than a dollar. I do not
know you that well, so I do not know what I would have to do to get your
attention, but if you are a fly fisherman, I am sure that I can get you excited about
some brand new kind of fly or certain kind of rod. Or you are a historian and I
could tell you about some new book that you really ought to have keyed in on.
P: Or my wife a new set of pots.
B: Alright, but there is something that could be more appealing to you than the
same amount of money than that item cost. Items have a better value to people
if they are interesting and well selected. So the stamp company's job, as we saw
it, was to keep an assortment of items that could attract a lot of people's interest
and attention. If you had a filled book of stamps, you could always turn it in for
two dollars. A filled book indicated that you had spent one hundred dollars with
merchants who use the service. At any time you could go and get two dollars for
it. For that reason, the merchant had to pay us when he got the stamp. We did
not know who he was going to give it to or what they were going to do with it.
But, if we did our job right, more people would like our merchandise.
P: So, you had the use of that money until it was redeemed, so that was the "float."
B: Until they redeemed, so, that is called "float" in banking terms. The only people
that have a comparable situation, that I know of in size and stature, was the
American Express Company. They sell their famous traveler's check. And the
average person who buys traveler's checks takes them on a voyage or
something and the checks do not come back for a number of months. They may
not have had as many months as we did, but they do have enormous float.
P: Then you could take that money, that float and you could invest it or do what you
B: Not only that you could take it and invest it, you had to invest it. Because you
had a legal obligation to those people that you someday had to deliver something
to them. So it was run like an insurance company. An insurance company takes
your premium and they have to be prepared, at some point, to return it when you
have met whatever your conditions are. In our case the conditions were fairly
simple: that you had to accumulate enough stamps to fill a book and then present
the book. The business had been a very successful business when I went there.
It had been a very successful business for, I went there in the late 1940s, so it
was already about fifty years old. It supported a family in a style we were not
entitled to. But then after the war it really took off, it just boomed. I was the only
one in my generation there for a few years.
P: You were in sales by this point?
B: Well, we went into a major reorganization of physical facilities. We had 3,000
stores and they were shipped their merchandise directly from the manufacturer.
There were a couple of problems with that. Number one was that we had grown;
the system got too cumbersome. I remember I met a man named Mr. Bigelow.
Mr. Bigelow said to me, "You know, your family and mine have what I think is the
oldest business relationship in America. We have had an order from you every
day for over fifty years. They made a carpet sweeper, a device people do not
even have anymore, nowadays everybody has vacuum cleaners. But for years
that was a household word, "Bigelow carpet sweeper." Well, it was terribly
inefficient. I mean, a clerk in New York really did not have a carpet sweeper you
could use all over the United States but, suppose you were sending fishing gear.
A guy in New York really did not know the difference between fresh water gear
and saltwater gear. That you could use one in Wyoming and the other one in
Maine or Massachusetts.
P: Or Florida.
B: Or Florida. But he would not know the difference. Or blankets--he would have
no understanding or feeling of regional differences. It was also enormously
cumbersome, as the business had grown with tremendous amounts of
paperwork and things bogged down. For example, how do you pay for things.
Well, usually you do not pay for something until you have evidence that you have
received it. Well, with 3,000 stores, Mr. Bigelow's invoices would not get paid
until each store acknowledge that they received it, then sent the
acknowledgement to New York. Then somebody in New York would pass that
one for payment. When we got into the modern world we changed it becasue
you could prove that ninety-eight percent of what good manufacturers said they
shipped, would get there. The amount that did not would be a small fraction,
where something went wrong, either in his store or in transportation or whatever
it was. We saved many people and tons of paperwork by taking the posture that
we paid against the manufacturers invoice and all we had to do was have what
they called exceptional accounting--you accounted for the exceptions. If the
store manager in Keokuk, Iowa got a notice that she had been sent twelve
cartons of electric toasters by General Electric company in New York, we would
have paid General Electric just on the receipt of their invoice. We would have
gotten a discount for paying them promptly and the store manager would have a
notice that she was due twelve cartons of these things and she would only have
to report to us if something went wrong and she only got nine of them. So, then
(we knew General Electric was good for it) we would charge a credit back to
them that they had short shipped or something. We went from the status of little
business to big business in this immediate post-war rush. We did not even think
of it as growth.
P: Your corporate headquarters were in New York, obviously. Where?
B: 114 Fifth Avenue. It was kind of a leftover district, but we had been there forty-
five years or more. The neighborhood had gone down. Currently, by the way, it
is coming back. They are now referring to it, because even before our time, that
was the "miracle mile" of New York. That is where all of the big major
department stores, Wanamaker, Lord and Taylor, Segal Cooper.
P: Where were you living?
B: I was living, at that point, still in New Jersey. I had moved there when I went into
the automobile business there.
P: So you had to commute.
B: So I commuted.
P: And you kids were going to school then?
B: My kids went to school in New Jersey.
P: Now is this about the point in your life when you begin to interest yourself in
things beyond just business. Is this where you begin to think about your interests
in hospitals and education.
B: Yes. I got interested in volunteer work. I worked with the local school where my
P: I am continuing the interview with Walter Beinecke. This is the second day and
we are once again in his office, it is July 10, 1990. This is in the morning. I want
to start out today, Walter, talking about another one of your major activities,
interests and loves, and that is Nantucket. I want to get into the program, the
PIN program. We come back will talk about the educational and medical
interests of yours, but I want to pick up on this particular thing to start with. When
did you first become acquainted with Nantucket as an island, as a place?
B: I guess one would say almost subconsciously, I came here as a child when I was
five years old. My family lived in New York City and I was ill with a disease you
do not even have anymore, mastoiditis. They had no particular treatment for it
except, they figured if you managed to survive it then you needed a period of
convalescence. The doctors would say take him to the sunshine and the fresh
air. My mother and father had friends, a pair of bachelor brothers who owned a
home in Siasconset, the little village on the far side of Nantucket Island. They
invited my folks to use the cottage under those circumstances and my dad could
not leave for an extended period, so my mother came up here with two small
children, I being the elder. We settled in the friends' cottage and she was there
for ten days, every one of which it rained. So I imagine she was probably
walking on the ceiling, at that point, confined in a little seashore cottage with two
kids and nobody she knew and ten rainy days, but the eleventh day was so
beautiful that she stayed forever after, until her death, fifty odd years later.
P: So your family fell in love with Nantucket many years ago.
P: We are talking now, almost seventy years ago that the Beineckes have had an
association with Nantucket.
B: Sixty-seven to be precise.
P: Now, did they acquire property here?
B: Not for eighteen years. The first year they were simply friends using another
friends' home. They liked it so much, then they rented it. After three or four
years my father offered to buy it and their friends would not sell it, so they
continued to rent it and I think they rented it a total of sixteen or seventeen years.
Then eventually the two brothers decided to sell and my mother and father
bought it and kept it many years after that.
P: So, as a child, very early on you came to Nantucket during the summer months
and you acquired, obviously, a love and a dedication to the island. How did you
get from New York to Nantucket in those years?
B: The normal way was to take the train from New York to New Bedford, then the
steamer from New Bedford. Nowadays they are called ferries but in those days
they were steamers, they literally were. They had four of them. The boat
systems of the steamers were run by the New York, New Haven and Hartford
Railway, a subsidiary of the railway company. In World War II, the two best ones
were taken to Europe. You may have seen photographs of then when they
boarded them up to make the passage across the Atlantic, but they were used as
hospital ships for the invasion from England across the channel to France on D-
day. One of them was sunk in the English channel and the other one eventually
came back to the United States, but never to Nantucket. It ended up down in
Newport News or one of the southern Atlantic ports.
P: How long was the trip from New York to New Bedford to Nantucket; the train and
steamer? Just a few hours?
B: I think it was around ten hours. I think the train was about five hours and the
steamer was three and a half. Then there would have been a period of time in
between. Their schedules were coordinated but they were not instant
P: How did you go from the wharf to Siasconset, which is several miles away?
B: There was a bus service and eventually my father kept a car up here, a Rio.
P: Now, you could go by water, could you not, from New York to Nantucket?
B: My father did that weekends. He was a commuter, we were here most of the
week alone. Dad would come up on Friday nights as did some other men, there
was a group of commuters. They made a very jolly affair of it. They could catch
the steamer at one of the docks at the foot of Manhattan near Wall Street. It was
an overnight trip up Long Island Sound. And of course, to a youngster, the boats
seemed very grand (looking back they probably were not). They had individual
passenger cabins, they had a dining salon, they had a big lounge. It was a big
thrill, at least once a summer, to make that trip with my father. They would leave
5:30 or 6:00 from Manhattan Friday evenings. They would reach the docks in
New Bedford 5:30 or 6:00 a.m. the following Saturday, walk across the dock from
the New York boat and take the Nantucket boat, which was a smaller vessel.
Leave New Bedford around 6:30 a.m. and they would be in Nantucket about
10:00 a.m. By then we had a car and it was a big event to come over and pick
up Dad on Saturday morning when he arrived on the island. Everybody around
us lived the same kind of life; a lot of the men were weekend commuters.
P: Then he would return on Sunday?
B: Yes. Saturday, late morning and noontime was family time. All of the fathers
would join their families and everybody would congregate on Siasconset Beach.
There would be picnic lunches and the summer community would all be there.
Then about 2:30 p.m. or something all the men would disappear because they
went off for their golf games. By then I guess they had had enough of the
children. Then Saturday night was a social night in the village. Sunday morning
was a replay, the men would have their golf game early, then they would come to
the beach with the kids and be relaxed until 2:30 p.m. or so. Then they would
have to make the trek across the island. It is seven miles from one side to the
other, it seemed a big trip in those days, from Siasconset back to town. They
would catch a boat, 3:30 or 4:00 p.m., from Nantucket back to New Bedford and
the night boat down to New York again. They would be at their office Monday at
P: And they had a chance to rest on the boat at night.
B: They would rest on the boat and, of course, they had bridge games and poker
games. They all knew one another because it was kind of a bunch of regulars
who were commuting.
P: What do you remember as a child on those summer days and nights in
Nantucket, down at Siasconset? Fun on the beach?
B: Fun on the beach, fun on neighbors. I remember growing from a tricycle to a
bicycle, that was a big event. I also remember having an Express wagon, the
little four wheeled wagon. I took vegetables out of our garden and sold them to
neighbors. I told my children that a great day was when I learned that you could
sell beet tops separately from beets.
P: You were beginning to become a entrepreneur.
B: That must have been the beginning of some of my entrepreneurial instincts.
P: Now you leave at the age of fifteen, you leave your family and you leave your
home. You really do not return until you are a mature adult, married with your
own children, all of those things, really after World War II.
B: Well, no that is not quite right, Sam. Because when I came back from Europe--
nowadays, I guess people think it very odd for a young man to go back and live
with his family, but it did not seem so at the time I came back from Europe to the
United States. I was unmarried and I returned to live with my family in New York
City. I worked in New York City. You are right that I established a more
meaningful relationship, particularly with my father, at that age, than I remember
as a child. By then I was twenty years old and in those days you did not think
you had to have (what is the modern language) your own pad (is that not what
the young people call it).
P: I think.
B: Well, alright, you live with more of them than I do. It was perfectly feasible for a
young man to still think he was pretty independent and still live in his parent's
home, if you did a little something to contribute to it. A part that I remember that
actually was very meaningful to me--my mother and sister would still go to
Nantucket in the summertime and my father would still take his vacation up there
and commute other weekends to be with them. But as a young working guy, I
did not have the means to commute every weekend, so I stayed in New York on
the weekends. But five days a week, my father and I, in the summertime, had
bachelor quarters together. That was a very meaningful time for me, as I look
back at it. He and I got to know one another, in what to me was a much more
meaningful way than during my childhood and the time I was in school.
P: Now when did you begin to become conscious of Nantucket's history? Living out
in Siasconset is long way from main street.
B: Really, I do not think that I had much interest or concern about Nantucket, except
as nice vacation place, until I was a young married. After I was a young married,
I started coming up here. My eldest daughter was born in 1945 or 1946. I
remember bringing her up her in a laundry basket the year she was born. She
was born in January, six months old when we brought--and I started the same
pattern as my father had. My first wife was from a family from upstate New York,
but her folks summered here in town. Not Siasconset, but in Nantucket.
Nantucket meant a lot to them and to her, so it seemed very natural that she
wanted to be here in the summer. Our first couple of years of married life we
came up and visited her family in the summertime. Then I was a little more
independent, we had a baby. I rented a little cottage. A big deal in those days,
$400 for the summer. I brought Jean and my daughter, Ann, up and settled them
for the summer. Then I had two weeks vacation, I spent that here, of course, and
I commuted weekends. I never was the type that, much as I enjoyed Nantucket
as a vacation place, I am not really a good vacationer. I cannot just sit on a
beach, happily for many hours. I am not much good at games. If you think about
it, it is amazing how many games are based on balls, golf balls, tennis balls,
volley balls. I am terrible with balls. I am blind in one eye and the other one has
problems. So, if somebody throws a ball at me I am apt to see two of them and
not know which is the real one. So, I have never been much at games and I
always look for something to fill in my time. So, I got interested in Nantucket
architecturally and historically.
P: Just as a person walking around and looking at these things.
B: Yes. I would spend more time doing that than sitting at a beach. My commercial
life at that time was sales and my instincts and my background were sales. You
can call it marketing, or you can call it merchandising, or you can call it
entrepreneurship, but I saw opportunities to do things.
P: What kind of things?
B: Well, I have long had a theory that if you are interested in the voluntary parts of
our system, we handle most of them, as a nation, as charitable activities and our
federal government gives tax exemptions if you support these things. It is a
deviation from the European system where the government carries so many of
those burdens. But our orchestras, our museums, our historical associations,
many of our cultural efforts are based on the American system of charity where
the only help the government gives is to say, "Well, it is better if those things are
done locally and by private citizens, than done by the government," so they give
you, to some extent, a charitable deduction. But so many of these things you
cannot do to the extent that your enthusiasm would like you to, just on charity.
You go around and pass a tin cup and say, "I represent a worthy purpose, will
you not throw something in the cup?" Now some of the cups get pretty big an
elaborate. Stanford University is the first American charitable institution to have
raised a billion dollars. That is a pretty big cup. My experience is that the needs
usually are always greater than the cup. So you have to think about that and
come up with some approach to get more leverage, more help. Well, ours is a
profit motivated economy. Some people think that is almost a nasty word. I do
not. I have been around enough parts of the world that I am convinced that this
has nothing to do with morality or philosophy, but in a material sense, our system
does more for the people under it than any other system in the world. It just
makes sense to me that what you try to do is fit your program into that system,
rather than being an exception and just existing on the charitable dregs that
people will throw off; try to fit your purpose into the system. In the case of
historic preservation, which was kind of the direction my interest in Nantucket
took, it meant that you had to find some pattern where you make people support
the goals of historic preservation, not just because they were being a nice guy
and throwing a little something into your tin cup, but because it was going to be
to their advantage. They were going to get something for themselves out of it. I
do not regard that as evil or selfish of them. Most people have to spend their
lives taking care of themselves and the people closest to them. If you want them
to participate in something that is outside of their first priority they have to get
some benefit out of it. Well, charity, the first benefit most people get out of
charity is a warm, friendly feeling that they did something nice. But they make
rather a minimal effort for that, the satisfaction is not that great that they are
going to give you very large sums of money. Being specific at a place like
Nantucket, you have a man that wants to put up a neon sign to advertise his beer
parlor, you have to find a way of showing him that he will have more prosperity,
he will sell more beer, his life will be easier and better if he does not put up the
P: That must not have been an easy salesman job, though?
B: It is not easy, but nothing worthwhile is easy, is it? The theory is much better
accepted now than it was twenty-five years ago when I started peddling it.
P: So you come into the program as someone interested in Nantucket almost as a
hobby. Then you figure out a way of selling it as an entrepreneur.
B: Right. I saw Nantucket going downhill. Nantucket was in deep depression thirty
P: What did it look like in the 1940s and 1950s when you begin to take an interest in
B: The residential district looked as it does today. That is the glory of Nantucket.
Nantucket's history is based on the fact that in 1846 the business district was
destroyed by fire. Smart money did not want to rebuild, because doing business
on an island, then, as it is now, is more expensive than doing business on the
mainland. Nantucket had gotten to be a preeminent, wealthy seaport simply
because they started their trade before the adjacent parts of the mainland got
into the same act. They had a seventy or eighty or ninety year head start on the
whaling industry. They were driven to it--they came here to become
agriculturalists--but agriculture was so bad on this little sand spit. Read the first
paragraph of Moby Dick, it tells you what Nantucket was. It is just a sand spit out
in the ocean. The agricultural life was so terrible, they turned to the sea. They
went whaling like the Indians did, in canoes offshore. Then they built bigger and
better vessels and sailed the north and south Atlantic. Then they went a little
bigger, understand scale, we are talking proportions. A bigger vessel in those
days meant a sixty-five foot ship instead of a fifty foot ship.
P: So, this is what brought the money into Nantucket.
B: When they had ships big enough to go around Cape Horn into the Pacific and
start getting the sperm whale in the Pacific. That is why on the main street today,
the bank founded in 1801 or 1802 is the Pacific National Bank, that is where they
made their money.
P: And the club is named the Pacific Club.
B: At the other end of the street the Pacific Club. That was the counting house, the
office and warehouse of William Rosh, a ship owner. His Nantucket vessels
were the Dartmouth, Beaver, and Eleanor. Those are the three ships of the
Boston Tea Party. He sent them to England with a cargo of candles made out of
whale oil. Nantucket had seventeen factories for making whale oil candles.
These ships had a mixed cargo coming home. They stopped in Boston on their
way home to Nantucket and they were the ships of the Boston Tea Party. You
were asking what Nantucket was like.
P: I was going to say you said that the residential area was the same but the
gardens and the houses?
B: No, not the gardens. Business life was stopped by the fire. The physical fire was
stopped by two brick buildings. The bank building at the head of commercial
Main Street, which acted as a barrier. They dynamited an adjacent building and
that gave them a fire break between the business and residential district. The
fire quartered and then burnt north, and the same situation was repeated as a big
three story brick building, the Jarred Coffin house. That gave them the break
when the fire moved north and they finally got it out. Smart money did not rebuild
the town, they elected to move. Because the mainland competition was catching
up, because it was more advantageously located. So the town went into a deep
depression, that was from 1846. The gold rush took many of the men and the
ships from this part of the country, not just Nantucket, but other New England
seaports. Petroleum oil in 1853 made whaling less prosperous and less
interesting to people. It is much harder work rowing around the world looking for
whales in a rowboat, than it is digging holes for oil wells. Your tax man will tell
you digging holes is not the greatest way to make a fortune, but the odds are still
more in your favor than looking for whales. Nantucket just lay dormant. The
local expression used to be, "They lived for fifty years taking in each other's wash
and looking at the sheep." They raised sheep on the moors. But then around
1890, they began to have a life as a summer resort. Summer business was
different, that was not tourism as we know it today. America was still basically a
class society then and there were a few rich people who could go away in the
summer. You had reasons for going away if you lived in the city, because health
problems were different, there was a reason to get your kids away from the polio
epidemics that happened in the summer and things like that. So, the market was
the relatively few people who could afford to leave the city and wanted to lead a
quite a life. They would come rent a farmer's cottage or a fisherman's house,
that type of thing. What they needed in services were very basic things. They
needed coal, firewood (later fuel oil, that did not come in until some years later),
lumber (because they would fix up the fisherman's cottage), things like that. So
the waterfront, which had been destroyed in 1846, became the town's industrial
area. Even when I was a kid in the 1920s and 1930s, heavy cargo still came to
Nantucket in a schooner. Have you ever seen them unload a schooner full of
lumber. A man stands down in the vessel and picks up a plank and holds it up
vertically and a man on the deck leans over and takes it and passes it to a guy
on the dock. Well, they do not move it again. Even in the depression days you
used three men to unload the plank. You would leave it on the dock until you sell
it. The docks had become the warehousing for the nearest thing we had to
heavy industry. That is where the ice plant was. That is where, first it was coal
and firewood and then later fuel oil. We had three tank farms. They occupied
eighty percent of Nantucket's waterfront. If you were thinking in modern terms of
this being a resort, its character as a resort is a historic seaport. The basic
commodity is sunshine and fresh air, the water vistas. The town blocked itself off
from its own waterfront by the nature of the economic circumstances as they
developed. As time went on, Nantucket had this nominal summer business and
people do not realize that tourism is a very modern thing. You, Sam, are near
my age. You remember five day weeks were not normal. Forty hour weeks were
not normal--two weeks paid vacation. I remember I was in an office of 700
people in New York and, it was not that many years ago, that I remember the
utter shock when everybody was gossiping around the office--a girl in the
stenographic department was taking a winter vacation and going to Florida.
Well, that is the beginning of tourism and that hardly seems more than yesterday.
But the way that hit here, in the 1950s ...
P: About the time that you are on the scene as an adult.
B: As an adult and beginning to be interested. There was a study sponsored by the
federal government on the concept of tourism and what it was doing to the United
States. You see, it really came in after World War II. Everybody became mobile
in World War II and after World War II the economy tolerated people, like my
stenographic friend, doing these kind of things. The federal government did this
study on tourism in Massachusetts. The federal government paid eighty-five
percent of the program, the state was supposed to pay ten percent and the local
county was supposed to pay five percent. Nantucket was the only county in the
state that would not participate. So we did not get the benefit of the study as a
direct measure. But our theory was that the arbitrage between Cape Cod and
Nantucket is quite constant. The number of visitors to Cape Cod stays in
proportion to about what happens here. So using that study, I became
convinced, and some friends I used to talk to felt the same way that Nantucket
was going to be put under a great deal of development pressure. You then had
what turned out to be a controversial question locally. If you convinced people
that this was going to happen, that we were going to have these large amounts of
people coming, the controversy then revolved around, "Do you do anything about
it?" Not the question, "What should you do?" The first question was, "Should
you do anything?" A great many people felt that you should not do anything and
things ought to be left alone and you just take whatever happens. Some, like
myself, felt, while you could not stop the path that what the country usually calls
progress, you could at least influence it, if you prepared for it. Out of this a
couple of us came up with the conclusion that positive action was called for. I
have gotten a little bit out of sequence--I had already started a non-profit activity
called the Nantucket Historical Trust. We had a local Nantucket Historical
Association which, even back at the time I am talking about, had between 2,000
and 3,000 dues paying members. In my crude way I used to refer to it as an
association of old ladies of both sexes. It was run on, what I think, is the
disreputable old theory of museums that, if at the end of the year, you could say
that the roof did not leak and nothing was stolen, you marked the year down as
another successful year. It ignores what a lot of people accept today, that
cultural institutions have an obligation to reach out and, if they have a mission,
they are supposed to act for that mission. It is not enough just to passively sit
back and say that if people are interested, they can come in and see what we
have got. Nantucket, in those days, had no zoning laws. We had one regulation.
We were the second place in the United States, after Charleston, to have a
historic district legislated by state legislature. Which allowed us to have
architectural control of the community. This was an effort to protect the
residential district, which is truly a national asset. It is the largest colonial group
of buildings in America. We still have, even today, just about a thousand
buildings from 150 to 300 years old.
P: Walter, let me stop you at this point, because I need to fill in some of the gaps.
First of all, you did not walk around Main Street one day, when you were here on
that vacation, when your wife was here visiting family, and an electric bolt did not
hit you and say, "this is wonderful and I am going to preserve it." It did not
happen like that at all, did it?
B: No. You develop an enthusiasm and then you think and study and consider.
P: What generated your enthusiasm? You were not into this kind of thing up until
then, were you? Were you conscious of the history of Nantucket?
B: No, it was a developing consciousness. It was during the late 1940s and early
1950s, all through the 1950s. Remember, I was only a part-time Nantucketer,
basically a summer person. In my winter life I lived in New Jersey and one of the
things that I had gotten into there was that I was president of a community
hospital in New Jersey. The vice-president was a man named Don McClean,
whose official title was advisor to the Rockefellers, he was part of the staff of
Rockefeller Brothers Associates. He knew my interests and thoughts about
Nantucket and he introduced me to a marvelous gentleman, a man named,
Kenneth Chorley. Mr. Chorley had been with Rockefeller Brothers for many
years and he was in charge of some of their important interests. One was the
Teton Park in Wyoming, the other was colonial Williamsburg in Virginia, the
historic reproduction down there. Don introduced me to Mr. Chorley, to let me
bounce out some of my ideas on Mr. Chorley. Mr. Chorley explained to me the
relationship between the foundation, Colonial Williamsburg incorporated as a
charitable foundation and the life and existence that it has under its charter that it
has from the state of Virginia and under the federal tax laws and the commercial
aspects of Colonial Williamsburg which are run as tax paying private enterprises.
This is the kind of thing that I was trying to envision here on this concept that
anything you want to do that goes on beyond the tin cup has to be part of the
business system. Out of that, my Dad was still alive and I solicited his help and
he made the first gift to the Nantucket Historical Trust.
P: Was he interested as a historian or interested as a businessman?
B: Neither, at that point. This was the year before his death, he was already a sick
man and he had stopped being a businessman.
P: It was something to please you?
B: It was out of affection for me and he always encouraged me when I was doing
anything that he could regard as constructive. He and his brothers were very
forceful, always, on the concept that anybody who benefited from the system, as
we did, had a duty to put things back into it. So, he saw me making an effort in
what he thought was in accordance with that policy and he approved and chose
to demonstrate his approval by helping me bring it about.
P: Now, when your family first started coming as a child and you first said you were
a summer visitor to Nantucket, were you conscious, was your mother conscious
of the history? Did you get a car or carriage and look at the old houses and
wonder all of these wonderful colonial places were still in existence?
B: No, I think that we took it more by osmosis.
P: Perhaps if you had not come and stayed in Nantucket itself, if you had stayed out
at Siasconset you may never have developed this attachment to the history.
B: That is quite possible.
P: You would have been just a summer visitor. At the end of the summer or the end
of the time you would have gone back to New York and that would have been the
end of it.
B: Yes, that is probably true.
P: So, you were in the right place at the right time. Now, at the moment that you
become interested in this Nantucket development, the 1940s and 1950s,
preservation is just beginning to get off of its duff, in the United States, is it not?
B: With a few prominent exceptions; Williamsburg goes further back than that.
P: When does it go back, to the 1930s, the 1920s?
B: Even the 1920s, I think, because it was the original John D. [Rockefeller] and I
have forgotten the name of the minister. There was a minister from Williamsburg
who instigated it. And there were comparable efforts in this part of the country,
Sturbridge Village and, of course, Mr. Ford's Deerfield Village.
P: So, there were a few things prior to World War II. But the country, itself, was not
preservation conscious. You tore something down...
B: Lots of us today think that the country is not sufficiently preservation conscious.
P: But at least it has come a long way in fifty years.
B: It is like that Virginia Slim cigarette "you have come a long way, baby." But it is a
long way to go too.
P: So when you come on to this Nantucket Preservation program, it is still (the
whole preservation business) in its infancy, is it not?
P: The reason I ask that is, I am wondering how much of a salesmanship job you
had to do here in Nantucket, itself, to convince that guy not to put up that beer
sign and to convince people to invest the money that it took to bring all of this
B: Sam, looking back on it I honestly do not know. You have to understand that it
was a labor of love. It was not my business. I was always earning my living, as
we say, over in America, and at things utterly unrelated to this. In the earliest
part of this I was with Sperry and Hutchinson and very active. I used to travel
350,000 miles a year. In those days, a fast plane was 300 miles an hour. Then
later, when I left S & H, I was in the ranching business. And in a business called
Christmas Club which was a service we sold banks. My principal interests were
on the mainland. I was still basically a summer resident here. Then after I made
more of a commitment, I started to do things here actively, it still was about a two
day a week situation. I would be here about two days a week all through the
P: Was your enthusiasm boundless right from the very first moment? I am going to
B: Well, the only commodity that I have had all of my life, I have often had an
overdose of enthusiasm and an underdose of brains. Enthusiasm can take you a
long way. When I get into something, I get, probably, overcommited to it. As a
matter of fact, I have wondered what would have happened to me or Nantucket, I
am not sure that either of us could have stood it if I had had a full time career
here. I would have driven everybody in town crazy if I had been able to last it out
P: Have you not already done that in a way. Preservation crazy, you have done it in
a very positive, good way.
B: Well, that was very controversial around here for a long time after I started.
P: Did you run into a lot of opposition?
B: Oh, sure. But the important thing to do was to analyze the opposition. Now,
when we started redeveloping the wharfs, which was after a hundred year hiatus,
the worst opposition was among summer people. For instance, a summer family
would come up here and daddy wanted to play golf and mommy wanted to
sketch and she loved to sketch that old barn down on the end of the wharf. Well,
the barn and the wharf had not been maintained for 100 years and the tide was
eroding its foundations and in about two more years it was going to slop right out
into the harbor. So, the lady was horrified when we rebuilt the wharfs. The
cocktail party conversation was very anti-me and my programs. Her husband did
not want to be bothered with the whole subject. He came here to beach and to
golf. So, this guy Beinecke was losing up the beautiful stuff that his wife liked to
paint, he obviously was a bum. The local people, many of them felt just the
opposite. There was a guy that had a fish market in that old barn and he was
worried because the refrigerator for his
[End of side C6]
[July 10, 1990]
B: The summer people thought this guy Beinecke is ruining the place.
P: Was there any money on Nantucket other than the wealthy people who came in
for the summer and the weekends?
B: There was not any local money in those days. The town, I have forgotten the
name of the program, but there was a federal program that gave extra money to
local public schools in deeply depressed communities. And Nantucket, in those
days, qualified under that program.
P: And the historical association depended upon its dues paying members?
B: On its dues paying members. There is always money available if you have the
right cause. We established that when we elected to build a hospital here, to
build a new one.
P: Now, you say your father gave money to the historical association. Was it a
B: It was in the days...not to the association, I made the distinction to you between
the association and the trust. The association was the public member
organization and I started to tell you why the names are so similar.
P: Okay, tell me that.
B: And what the distinction was. We had no zoning laws at that time. A very
beautiful property, the last or first, depending on which neighborhood you are
coming from. If you are coming up commercial Main Street and you pass the
bank, you move into what is now recognized as the historic residential district.
The first building on the left, a very beautiful home, was about to be bought to be
a tap room. That is the story I was telling about the neon signs and all. There
was nothing in our zoning codes that could stop that, because we had no zoning
codes anywhere on the island. All the man had to do was keep the exterior
shape of the building, under the historic district regulations. The historic district
regulations related only to patistration, roof pitch, color, and texture, the external
materials. Anything inside was your business. So there was no law that would
stop that from being made into a restaurant-tap room. A couple of us felt that
was a terrible mistake, to let the downtown business start expanding up into that
very beautiful residential district. We had no legal basis for stopping it, so we
used just plain economic clout, we bought it. We held the building for about a
year and a half, at a slight loss, until we were able to resell it. Our terms for
reselling it were that the buyer had the contract that it could only be a one family
residence. We achieved, in other words, by contract what nowadays would be
achieved by zoning law. It went so far that the Internal Revenue challenged us
because we had a slight loss on it. They were convinced it must be a rip-off, that
we were selling it to somebody related to one of the trustees or something like
that, just designed to stick Uncle Sam. We eventually prevailed on it, but it was
very interesting because nowadays, the concepts of deed restrictions and
limitations on real estate titles and so on are widely used. Not only for
conservation but for historic preservation. Actually, you can trace some of it back
to Mr. Kennedy's administration; his father-in-law bought real estate on the
Potomac to protect the vista of Mt. Vernon and gave deed restrictions on the land
and took a tax deduction for the value of the deed restriction. You understand
the system is that a piece of property with a restriction on it can be proven in a
court of law to have less market value than unrestricted property. If you own a
piece of land and can build anything on it you want, obviously the market value is
higher than if you own the land but are told you can never grow anything on it
more than three feet high and you cannot put any buildings on it and so on. You
have established two different values for the same physical asset. The idea of
getting people to recognize that difference in market value and make a gift of the
restriction, that you can show that they have given something of definite
economic worth and then they can reflect that in their taxes. So IRS, at the
beginning, challenged that type of thing. Nowadays it is a tool that is used all
over the United States for assembling conservation land, park land, historic
restorations. It has extended even beyond those elements of real estate to, for
example, some of the exotic ones are facade easements where a value is
established on the external appearance of the building. You can deal legally with
that and give the facade to one organization where somebody else still owns the
useable aspects of the interior of the building.
P: Were you responsible for the original restrictions which were limited, you say, to
roof pitches and so on?
B: No, that was achieved, in considerable part, before my time (by) copying
Charleston. Nantucket did it in, I think it was 1955, at which time I was dabbling
around the edges here.
P: So, there was already a group of people who you were able to join forces with,
who were already sensitive to the need of preserving Nantucket. It was not
something that you came in single-handedly and had to build.
B: My contribution to it was the merging of the commercial thought with the cultural
goal. And recognizing that commerce could be a good partner and that it was
enlightened self interest for commerce. The people who were working on it
before me were doing it from what I call the tin cup approach. You understand
what I meant by that?
P: Yes, I understand. You used the pronoun "we", now this means these were the
people that were here; some physically here, some summer visitors, like you,
interested in the historical significance of Nantucket.
B: I think, maybe, my contribution was in putting together opportunistically--there
was a man who lived here (since died) Henry Coleman. Mr. Coleman was from
an old, old local family, several hundred years. Henry, by local standards, was
very broad minded. He did not share--there is a state of mind some people have
if you grow up on an island, you kind of pull everything in around yourself and
you will not relate to anything on a broader picture. You are more resentful of
change than most people and you get a little more isolated. Henry was the exact
opposite of that. Although he came from that background he was very farsighted,
forward, outreaching and a very warm man. He was older than I, but Henry
understood what I was trying to do and became my best support.
P: A real ally.
B: A real ally. That was very important because, to many people, he was "Mr.
Nantucket." As a young man he taught in the school system here, so many local
people remembered him as their teacher. He was an officer in the army in World
War II and there was a group of men who remembered and recognized him as a
leader from that point of view. Then in community life, here in the 1940s and
1950s, he did every job in town. He had been president of the hospital, he had
been president of the Rotary Club, he had been chairman of the board of the
library trustees. Every worthwhile thing in town.
P: So he was a strong ally for you to have.
B: He was the best I could have had. Then there was another man who came from
the commercial side of it. He had no relationship to what I call the tin cup
philosophy. He was strictly a commercial guy. He had a dream for Nantucket.
His was earlier than mine. His was utterly commercially driven, profit motivated.
He was a man of inherited wealth. His family had controlled the Four Roses
Whiskey Company. I think it was in Kentucky or Tennessee. He accumulated a
lot of land here in the 1940s, right after World War II. He was a smart man in
some respects, but he had nothing of a desire to please other people. I was
going to say salesmanship, but it was, I guess, more fundamental than that. He
enjoyed being smart and he was kind of caustic. His sense of humor was always
pointed and a little bit mean. He handicapped himself, his worst problems were
things that he created for himself. He accepted my commercial approach as
being at least the equal, and maybe, in some respects, more imaginative than
his. So he became a very important ally. Politically and culturally, Henry was the
important ally. Philosophically, Henry was the important ally. Henry became a
trustee of the Nantucket Historical Trust, as did another man who was
deliberately picked because he was the president of the historical association.
The historical association should have been the people to buy the house that I
was referring to. I spent a couple of weeks trying to wake them up and get them
to move and buy it before this tap room operator bought it. And in desperation,
when I could not wake up the association, they were so cumbersome, they only
had one annual meeting a year and they said this was too important, they could
only deal with it at the annual meeting. We had ten months to go and the thing
obviously would have been long since gone by then. I said, "There must be
another structure." That was when I was talking to my friend McClean and he
sent me to talk to Mr. Chorley. Mr. Chorley got me to thinking, so I came back
and set up this non-profit organization.
P: The Trust?
B: The Trust. I wanted to keep it very much in harmony with the historical
association, so I picked the name that is very close to it. In the legal sense, the
charter of the historical trust said that if it is ever dissolved, what ever we have
left over goes to the historical association. It was intended to be a more flexible
and a more unilaterally controlled organization that could move at a faster pace.
And it had the prerogative that the association did not have, that I was willing and
with my father's help, right at the beginning, to commit money to it. In effect, the
old slogan "put your money where your mouth is." The point was it did not have
to be a lot of money involved. The people in the other association had no
courage or imagination, they would have been scared to death. We bought the
building the way you normally would commercially, with a big mortgage on it; all
we had to fund was the seed money. What I did after that was done the same
way. Most of my work at Nantucket was financed by the Northwest Mutual Life
Insurance Company. Not because they cared about Nantucket or were
interested in historic preservation, it was because we were able to put plans
together that showed from the commercial side, that we could be good
borrowers. Their business is lending money. A lot of people get uptight and
think, "What a terrible thing to ask a bank or an insurance company for a loan."
That is their business; they make their money by lending it. They do not want to
be paid back right away. It is like a landlord renting space, they rent money. If
you do not borrow it, they are not doing any business.
P: Did you see from the beginning that this trust was going to be a lasting activity or
just for the purpose of securing this one property?
B: No, I hoped that it would be, that it could go on. I thought there were all kinds of
opportunity in front of us. Actually there is a young woman, right now, who is
writing a history of the trust, from a historical point of view. She is not doing an
oral history like you are, her assignment is to do it from public records. What you
were commenting on yesterday, the oral history is only good after you find the
verifications. She is approaching it the other way, she is finding the public
P: What was your early dream of Nantucket?
B: Sam, I can only tell you in a long-winded way. Let me tell you stories, I make my
points better that way. My commercial partner, his name was Lawrence Miller.
P: He was here in Nantucket or in New York?
B: He had a home in New York, he had a villa in Asti, Italy and he had seasonal
home here at Nantucket.
P: What was his business?
B: To the best of my knowledge it was investing his inherited money. I told you he
inherited the liquor company.
P: But you knew him here as a Nantucket person.
B: Saying it that way here has a very definite meaning. There was even a
magazine article about me one time about fifty years and still an outsider. You
are not a Nantucket person unless you were brought up here and went to school
here. That is New England colloquialism. You must have the some of the same
kind of thing in old Florida.
P: Right. More in places like Savannah and Charleston.
B: Well, the same attitude. It was announced in the newspaper that Miller and I
were, at that point, acting in a partnership, which was named Sherburne
Associates. The name came because Sherburne was the original name of this
P: Now, does this pre-date the trust or post-date the trust?
B: Sherburne Associates post-dates the trust. We made the non-profit organization
first. Then I made the partnership with Miller. He put all of his Nantucket assets
into the partnership.
P: He is doing this as an entrepreneur, trying to make money.
B: As an entrepreneur. He had more to put into the partnership than I did.
P: Was he also dedicated to the historical significance of Nantucket?
B: Not if it cost him anything.
P: He is what I call a cardiac person. He felt it in his heart, not necessarily his
B: Okay. It was announced in the paper that Sherburne Associates had acquired
the wharf. Straight Wharf, historically, and even today, is the most important of
the town's wharfs. It is called Straight Wharf because it is straight down Main
Street. It is the extension of main street into the harbor.
P: It is the one that goes past the A & P?
B: Yes. The paper announced this on a Thursday, and Friday morning I was
walking down the street and a friend stopped me and said, "Walter, I read in the
Wharf your group got control of the Wharf, that is marvelous. You know that
damn tourist boat comes everyday and brings 2,000 people. They walk up and
down the streets, ringing my doorbell asking if they can use my bathroom
because there are no public facilities. They throw their trash around. They get in
those damn big tourist buses and make a traffic jam because the streets are too
narrow for that kind of stuff and then they go home. They come with a dirty shirt
and a five dollar bill and they do not change either. They do not do any of us any
good, why the hell do you let them land? Why do you not just stop that boat
landing there?" I said, "I will think about it." I walked about ten steps further and
another fellow stopped me and he said, "Walter, I read you got the Wharf. That
is marvelous." He said, "You know that damn boat only comes once a day.
Mummy wants me to buy a color TV. I have got two kids to send to college. I
would love to have a vacation myself someday. The bastards will all go home
after Labor Day and then we can live like people, but in the lean time let's do
business. Make it come two or three times a day."
P: You had some conflicting advice.
B: Okay, which one do you think is right? My hang-up is that I think they were both
right. You cannot say I am working to preserve a landmark of important national
interest. You will find there are many of us who truly believe that historic
Nantucket needs that kind of a definition. You cannot say that I am going to save
that and run it so that only Mrs. Rich Bitch can come here. You have to have it
open to Mr. and Mrs. America, if it is what it is supposed to be. Alright, but then
how do you match these problems. Well, the way we did it was, we tried to
convince the boat operator to work differently. He could not see it. He ran an
operation that was based on a very cheap investment. He had an old World War
II navy hull that had been sold as war surplus and every year he coaxed the
coast guard for a permit to run one more year. It was a dirty, sloppy old thing.
And he could not envision doing anything else. His effort was to do it the
cheapest possible way and to make as much money as he could and that was all
he was interested in. His partner who ran the bus operation coordinated with the
boat had old third had school buses. I used to love to show people the sign. You
got off the boat and there was a big sign "Three Hour Tour of Historic Nantucket,
Including the Airport." Including the airport, these people just came from, what in
those days we called Idylwild, you young guys would say Kennedy (or if they
came from Logan in Boston), they did not come to Nantucket to see an airport.
But the point was, the man was a reasonably honest Yankee. He wanted to give
his customers some value and the only things that he had were time and
mileage. They were forty-eight passenger school buses and could not get
through the historic Nantucket streets. He could not get up to the oldest house
on Sunset Hill or the 1800 house on Chestnut Street. What he had to do was
take the nearest thing to a straight road out of town and drive the perimeter of the
island. He could talk for the first twenty minutes about the flora and fauna as you
went by the moors and he showed them the village of Siasconset, because he
could get the bus through there. Then there was nothing to talk about for the
next hour except that you passed the airport on the way back to town. Well, the
way we finally attacked it was, we outlived the lease of the boat operator. He
had a long term lease when we bought the property. We had to live with that for
a couple of years. Then we found a boat operator who would buy small boats,
faster, cleaner, and sign a contract that he would only land five hundred people
at a time. We got a bus operator who bought new buses and they are limited to
eighteen or twenty passengers. He made a deal with the historical association
and he can take his passengers up to the oldest house and make the necessary
turns to get in there. He can take them to the other museum properties the
association has. Now, it is perfectly true the customer pays more. The
customer's fare on the boat and the customer's fare on the buses is higher than it
used to be, but they are getting an entirely different value. They see historic
Nantucket now. Five hundred is a lot of people, but it is not 2,000 people, which
is like a cattle car crowded into the same space.
P: Now when you say Sherburne owned Straight Wharf, you, as a result then, could
decide who could land and who could not land in terms of boats.
B: That is right. This is where the commercial aspects fit in. You used your
commercial assets in a way that goes with your long term purpose.
P: Presumably you had to have to have the support of the city fathers?
B: Well, you did not have to have their legal support. You are smart to have it
politically. Now legally, as the landlord, we did not have to let anybody on that
wharf. There are still businesses in town, you go out and walk the streets today,
there is a competitive bus operation that parks its buses right over here near the
post office that are big, old fashioned, large buses. But we would not let him on
the wharf. If you had the right commercial plan and the right commercial real
estate, you could structure a pattern that influenced everybody else. If you are in
the bus business here, you want to be at the point of arrival, where the
passengers arrive on the island, which is on the dock.
P: Why did you need Sherburne Associates if you already had the trust? The trust
had the legal right to acquire properties.
B: A trust can have the legal right to acquire properties, but you can also get into
problems. The first big thing we did, other than the house I spoke of, in the non-
profit trust was we took a building--it is the only three story private residence that
was ever built here, a brick building called the Jarrid Coffin house. The Jarrid
Coffin house was built by, I guess, the wealthiest man of his day in the 1830s.
P: The wealthiest man in Nantucket and Massachusetts.
B: Yes. He built this beautiful home in the center of town. His previous home,
many people still think is the most beautiful place in Nantucket, is like three
blocks from the center of town, called Moor's End. It has a gorgeous garden with
a brick wall around it and everything--a very lovely Georgian property. His wife
thought she was too far out in the country. She insisted on building this mansion
in the center of town. Shortly after it was finished was Nantucket's great fire.
Her house was one of the things that helped stop the fire. But instead of being
queen bee in the center of town, she was queen bee looking over a sea of ashes.
She got fed up and made the old man move to Boston. The property was sold
only two years after it was built and became a hotel. It was the preeminent hotel
of the town for many years and then slowly traded down. Finally, in World War II
it was the navy barracks. They had not only had the main building, but they took
the space around it. Across the street they built a conventional wooden navy
barracks building, there is a garden there now. Behind the building, what is now
the parking lot, they had another barracks building. Nantucket was important in
the days when we talk about defense in the early 1940s. The United States was
not at war, everything was a defense program. The point is that Mr. Roosevelt
called us the arsenal of democracy and we sure as hell were at war. Technically
we were not, but we were making everything and shipping everything to the Brits.
Stuff moving out of Boston and New York, the Germans would try to sink it as
close to port as they could because, obviously, the closer they could get into the
shipping lane, the less area they had to search. Nantucket was about as close
as the subs could get. There was submarine activity just off our coast here. Our
airport was built to be an advanced fighter base, looking for submarine patrols
and things of that type.
P: The historical association and the trust complimented each other.
B: I know that I am long-winded, but let me finish this example I was on; it will
explain the relationships. This property after the war was utterly decrepit.
P: This was the navy property.
B: The Jarrid Coffin house. Economically it was harmful to the town. When the
property came back into private hands after the war, the owner did not have
much capital or much imagination. It was like Fort Lauderdale at Easter, the first
kid paid six dollars for the room and if he had ten friends who paid him a dollar a
piece, that is the way they used the room and threw the beer cans out the
window. Well, we are too small a town for that. It is an awkward character, you
do not want to be that kind of a residential community. You are not going to keep
a prosperous clientele, an attractive clientele if you do much of that. Acting as
the historical trust, the non-profit group, we bought the real estate and undertook
to restore it. We were undertaken to restore it from a historical preservation point
of view. We had to teach people some relatively forgotten skills, like casting
plaster moldings and things of that type. We restored the building strictly with an
eye on help. That was an important thing in those days, importing people was
kind of a no-no. There were so many unemployed people here that it was
important politically to keep relating and doing everything in town.
P: And they had the skills?
B: We had to help them develop them, in some cases. Many basic skills--carpentry,
cabinet work, things of that type, we had good strong qualified people. But there
were some that we had to supplement. We bought used furniture all through
New England and brought it down here. We opened a cabinet shop, where one
of our skilled cabinet makers taught other neighbors how to refinish furniture, so
that we ended up, instead of used furniture that we brought in from America,
when it was finished we had antiques that we were proud to show off and put in
P: You must have had some very qualified workmen here or people who were
amenable to learning these skills?
B: We did. My wife criticized us, because she said you are just dealing with just
bricks and mortar and a home was not built that way. You are not doing anything
about the interior properly. So we set up schools, that were particularly her
interest, to teach local women to do hand weaving. Then we set up a needle
work school. This is how commerce and non-profit can work together. We
brought in teachers from Europe for about six or eight years. We brought them
from England, France, Belgium, Sweden--I think those were the basic ones--to
teach needle arts. We would bring them for four months. For the first two
months, which would be in the Spring, May and June, the teacher would teach
local women, who were allowed to enroll free, as guests of the trust. Then in July
and August, we would promote the school and summer visitors, ladies, would
pay for lessons. It was still a non-profit organization, so it was legitimate to do it
under the trust. The point was, the income earned from the summer students
almost offset the cost of giving the local people free lessons, so the trust's
contribution was seed money. We were always working on the business
principal of leverage. You get more done if you use your own money to instigate
something and then try and make it, as much as possible, self supporting.
P: What was the base of the trust. You were in the trust, I mean, who were the
people? You once again use the pronoun we and you mention two or three
people, was it broader than that?
P: A handful of people, then, ran the trust?
B: Yes. The whole point was, the lesson in front of us was the historical
association, with 2,000 people, you could not get together to make a decision.
P: Too big and not flexible enough.
B: Not flexible, so we kept the trusts--the first gift was from my father, then later it
was mostly from myself.
P: You were putting your money where your mouth was?
B: Yes. But also in the belief that I was eventually going to be protected and it was
going to be alright. It is "where do you cast the seed?" and then "where do you
P: Was your father the first donor?
B: Yes. Then there were not any donors for some years, except myself.
P: So, it was really a Beinecke trust in a way, at least where the money came from.
B: Yes, it was and it is today. But it had different lives in between. Today it is my
children and myself. They are all grown up and they are the trustees. I am
P: So the trust continues right through today?
B: Yes, but doing other things. The trust eventually leads to PIN, that was probably
our biggest thing in the long run and the University of Florida. The trust carried
on the weaving and the needle schools. It got the building restored for the use
as a hotel. That was important for the community, because the community in
those days made its living in about ten weeks, from the Fourth of July to Labor
Day, and then business ended. One of the reasons it ended was there was no
help here except for college help and there was no inn or hotel to stay open on a
year round basis. Everybody said, "Well, we have to extend the season." Well,
you cannot extend the season if there are no facilities for the customers. The
trust, initially, when we finished the construction phase of the hotel, we
negotiated with people on the mainland to operate the hotel. Then, after awhile,
we found that the trust should not be in the operating business. The trust had no
reason to have a liquor license and be engaged in the management of a hotel.
We thought, "We have the asset there. Maybe the way to handle it is to have a
percentage lease." Which is a common commercial practice, where the tenant
pays a percentage of his business, rather than a fixed rent and that would give
the trust an income. But it kept us too much involved with whether the hotel was
being well run or not. So we finally opted to sell the hotel and to put our assets in
other programs. The needle school got so complicated and involved that that
began to be a commercial operation, so we liquidated the school and the
business and both of them have carried on ever since as commercial
businesses. The man who was the foreman of the weaving division has for, I
guess sixteen or eighteen years, been proprietor of what is a very successful
business here in town called the Looms, on Main Street. Your wife has probably
already fell into that mousetrap.
P: I hope not.
B: Well, it is very nice and they have done very well. They employ maybe ten
people on a year round basis. But in a little town like this, a new business that
employed ten people--it is not so important now--but twenty years ago that was a
significant addition to town.
P: Now they weave?
B: They weave hand weaved fabrics. They weave for the very fancy couturieres
who are willing to pay high prices so that they have a fabric that they know no
other lady will appear in a comparable gown. They weave--I guess some of their
biggest things now are for architects--for big offices and banks where they want
draperies thirty feet high and with the trademark woven into the thing.
P: So they weave the cloth.
B: They weave these things. They do a great deal of art weaving, fancy things,
stoles and shawls for ladies made out of cashmere and things like that.
P: Expensive items.
B: They are all expensive. That also goes back to a fundamental thing that we
recognized at the beginning and this relates to historic preservation, it relates to
commerce. The conventional approach to business is to seek the solution to
your problem by having more and more volume, which usually means more and
more customers. But if you are an island and a small town and those are your
fundamentals, if people come to see you because you are this attractive small
town. I will give you an example in your own state. Mr. Disney, when he did his
first job, he built Disneyland in California on seventy-six acres. When he had the
chance to do it over in Florida, instead of calling it Disneyland, he called it Disney
World. The symbolism of how much bigger he envisioned it. In Florida he
bought 28,000 thousand acres and then bought ten more, next to it. Well, we
cannot get ten more. The next ten thousand acres to us is full of fish. And we
cannot have unlimited crowds. We would have to tear down half of downtown to
have enough parking space and rest rooms. We have to freeze, or at least
retard, the number of visitors to restrict the growth. So commercially, what do
you do in such a circumstance? You do what a merchant would call trading up.
P: You jack up the prices?
B: Well, you offer different commodities. You increase the value of the average
transaction. Instead of selling hot dogs, you sell steaks. Instead of selling
postcards, you sell paintings. The town has to live; America is an inflationary
economy, our political system dictates that. You cannot say to people here,
"Since you have the privilege of living in a beautiful American landmark, you have
to live on a different economic scale. Your wife cannot have that color TV, your
children cannot go to college." You cannot do that, he has to participate in the
same economy. So our economy has to grow and has to have more dollars. But
if it cannot get its dollars by just having more people. The man who sells the
postcards says "I cannot live, I only have 2,000 customers a day buying
postcards, I have got to sell 4,000 postcards a day, I need twice as many
customers." Well, he would destroy us doing that. He is down there on the water
front and we would have to tear everything else in that part of town down just so
the 4,000 people could fit into it. That is a fundamental irrationality, you just have
to find another way around it.
P: So you make him sell paintings.
B: So you have to teach people that they can make more money for themselves.
You have to get back to the self interest. I think it is fascinating what is
happening now in Europe.
P: Since that is so different from the traditional way of doing business in the United
States, because we go after volume, was that a difficult thing to sell here?
B: It still is. It always has been, I am not saying we are originating it. I mean, there
are the exceptions: how did they build Tiffany's? how did they build Cadillac?
There are people that find that the path to quality is equally or more prosperous
than just going for volume.
P: They are willing to spend twenty extra dollars just to have the Polo emblem on
B: What we have to have, in our circumstances here, are two things--we have to
have quality and distinction. That means that people are not going to eat
hamburgers when they come to Nantucket, but it would be terrible if we had
McDonald's hamburgers. We have to have Mrs. Coffin's hamburgers and we
have got to do something to make the environment around it a little different.
Take Holiday Inns, as I traveled as a traveling salesman for years. I go back to
the time, when as a young guy, you did not go by airplane then, you went by
train. On the train, the young guys like myself would rush to the first sitting in the
dining car. It was not because we were pigs and so desperately hungry. It was
because we wanted to be sure that we got through the dining car and back to the
club car to have seats when the older men came back. Because, then you sat
around and the older guys would say, "Where are you going, son?" I would say,
"Salt Lake." Then he would say, "Listen, such and such a house is lousy. Its
dirty, Christ I even had fleas there once. But there is a nice boarding house two
blocks further." You would get your book out and notice down where that was.
Then the guy on the other side would say, "Well, where are you going after that?"
You would say, "Grand Rapids." He would say, "There is a wonderful boarding
house there, they lady sets a good breakfast." You would write it all down.
Holiday Inns came along and the London Times voted Wilson, the founder of
Holiday Inns, one of the hundred most influential people in the first half of this
century. He just changed the traveling habits of the nation. It is not because that
they are the greatest or fanciest hotel in the world, but they introduced the
concept of a known standard. You knew that you could get a clean bed, clean
sheets, a clean bathroom and that the food was of a certain quality. You could
get this everywhere. That is fine for a working salesman. But people on a
vacation or a holiday are looking for something different. The United States
nationally, I guess it is particularly through TV and the other media, is becoming
more and more homogenous. And homogenous means almost without
distinctive character. If you are going to appeal to people as a vacation site, you
have to have a distinction. You have to have something different than the
McDonald's and the Holiday Inns. A Holiday Inn would be a disaster for us,
because everyone who comes to an island has made an investment, an extra
investment. Either in money they paid in premium to take an airplane to the
island or in time--they spent the extra time on the boat to get here. But if all they
were looking for was sunshine and fresh air and beautiful beaches, Cape Cod
has the same thing, three hours earlier, sixty dollars cheaper. And on Cape Cod
the federal government pays to maintain the beaches. As an American citizen
you can have a gorgeous time over there. So why would you make the extra
effort to come here? Well, you make the extra effort to come here because we
maintain some distinction.
P: Your distinction is history?
B: Our particular distinction is, basically, the physical manifestation of our history
and the beauty of our community and the architecture. So anything like those big
buses or anything that is an anachronism that attacks the fundamental assets, is
attacking the future. Now, you can explain this to business people and that is
why you can make a business person a constructive partner in a historic
preservation effort. You can make him see the difference between the short term
buck and the long term investment. I mean, if he is in the business where what
he has to worry about right away is "what cash can I get today," there is more
profit in selling Mr. McDonald's hamburgers than there is in building an attractive
dining room that is going to take longer to pay for. But if you can show that you
own that real estate and you are not only interested in what it produces today,
but you are concerned about what value it is going to have ten years from now or
twenty years from now, you can sell the long term contract.
P: Tell me again why you needed Sherburne?
B; I tried to give you an example that when things get too materialistic, too
commercial, they are not properly done by a trust. Starting with the fact that the
Internal Revenue would attack the validity of the trust if you are doing commercial
things in it. You are claiming tax exemption and competing with a guy who is
running a barroom down the street.
P: So you need that flexibility to do the things that you needed to do.
B: Right, but we also needed the strength.
[End of side D7]
B: ... The insurance company, that we could be considered as a solid real estate
investment and that if they invested and let us restore buildings or build buildings,
that it could be just as good an investment to them as building a shopping center
in Worcester, Massachusetts or somewhere else.
P: Does Sherburne still continue today?
B: Sherburne was sold when I retired three and one half years ago. It is now
publicly owned by a company headed in Boston, but has several thousand
P: But the trust still continues today?
B: As a family we maintain two foundations. We had the Nantucket Historical Trust,
which only worked here. We also had a foundation called the Osceola
Foundation. After we sold our Nantucket interests, we liquidated the Nantucket
Historical Trust. Although we have carried on some of its programs, such as
PIN, with support from the Osceola Foundation.
P: When you first moved into this activity of preservation, did you look at the whole
town and say, "We are going to do all of this--we are going to go from the Pacific
Bank all the way down to Straight Dock or did you see it in pieces?
B: The interest in the beginning was to acquire the south side of Main Street, in
those days which was rather tacky, and restore that. That was the height of our
ambition. But the weakness of the concept that I have described to you--you see
it is very different from Colonial Williamsburg. In Colonial Williamsburg vast
sums were allocated to doing a master plan from the start. Our approach was
much more opportunistic. We had to do things as we could figure out the
financing of them.
P: A little bit of the time.
B: It ended up in the commercial part we had about 120 separate major real estate
transactions over a period of twenty-five years. The commercial division, as
Sherburne Associates ended up owning about half of the commercial locations in
Nantucket and about sixty-five percent of the commercial space. The distinction
being real estate people often discuss what you have in terms of square feet.
Well in square feet, we had about sixty-five percent of the retail space in town.
Disproportionate to what I said about the number of locations, we had about half
of the locations. But we included in our ownership the only large stores. Colonial
stores usually were 750 to 800 square feet, maybe 1000 square feet would be a
big one. But in the modern part we had the only supermarket, plus our large
hardware building and those gave a disproportionate look.
P: Everything in the downtown area then, dates since the fire?
B: Yes, there are almost no exceptions. There are three brick buildings downtown
that survived the fire.
P: Were you restoring brick buildings, wooden buildings--what kind of structures
B: I usually try to be careful not say restore. We really were not great
preservationists. The part of Nantucket that is worth preserving is the historic
district which is the residential homes, the part of town that was not attacked by
the fire. Most of the work we did was to build modern facilities in a form that was
compatible with the historic district. Take for example the A & P that you
mentioned a little earlier. We approached the problem here by cleaning up the
water front. I described to you earlier how that had become kind of the town's
back yard, the industrial area. We came up with a plan to carry the town's
streets--the town had closed itself off. Its last public access was several hundred
feet from the water front. We carried the pattern of streets back to the water front
and gave the town the streets, then demolished the lumber yards and ice plant.
These were all things from about 1900, they did not go back to the whaling days.
One of our problems was that, until the late 1950s the two principal markets in
town were the A & P and the First National. Now markets are very important to
the real estate values of a town, because in pedestrian towns, which we were,
they are the biggest pedestrian traffic producer. Commerce is based on your
pedestrians; how do people get to you. Of course, particularly in California, you
are familiar with the fact that so many towns have been destroyed in modern
years because the change to the automobile has produced the pattern of building
things for automobile access so that the historic down towns have been
eviscerated economically. We were afraid that that was happening here because
the First National moved out of town and built a modern market.
P: First National is a grocery store?
B: They are a major chain in this part of the country, comparable to A & P. They
built a horrible thing. It was a cinder block building four sides, they did not plant a
blade of grass, they did not pay any attention to local architecture. It was a flat
industrial roof, but economically it was a great success. Because it brought
people cheaper groceries and it brought them parking space. A & P could not
wait to do the same thing and move out. It was easy to prove that this would be
very damaging to downtown. Downtown would have no year round traffic
centers. You would end up with nothing but pizza parlors and bicycle rental
shops for the summer trade. If you destroy the economic values of the business
district, eventually that would be reflected in the residential district. You will not
own a beautiful home if the only thing in your neighborhood, the next block is all
pizza parlors and junk stuff, postcard shops or something. You have to admit if
you are interested in preservation, beautiful old buildings do cost money to keep
up. Unless you have some government grant that says these are important
enough to keep, you have to look to the private sector to keep them up. The way
to do that is to keep their market value up. You make the community attractive
enough that people will want to come here and buy a home, even if it is an
expensive home and pay the money to keep it up. We felt that we had to keep a
real estate value downtown and that the only chance we had left at that point was
the A & P. They were going to move out, the way First National had done, but
we convinced them that we could clean up the waterfront space and provide
them an adequate amount of parking, but we wanted them to build a certain kind
of building. Well, their approach to it was, "Oh yes, we have three stock colonial
designs, A, B, and C. A is 30,000 feet, B is 15-20,000 feet and C is 10,000 feet,
and Nantucket rates a C." Well their stock colonial design--I will not comment on
it, you are associated with a wonderful architectural school, ask them about it.
P: It was lousy?
B: Well, for the supermarket industry it is pretty good. But it is all plate glass
windows and what not. It just does not completely go with a historic community.
P: It does not fit in with the decor.
B: Well, what we did, we wrestled with the A & P and we won some points and we
lost some points. But we got them to accept our thoughts on scale. One of the
major problems is that modern things are all much, much bigger than old things.
You look completely out of character if you build some big modern thing, even if it
is in good taste, in a community of small scale. The A & P will not ever win any
prizes for great architecture, but they at least accepted that they should make an
effort to make it look like smaller buildings. It is intended by them to look like
three separate buildings that might have been old warehouses. It is the only A &
P in the country that by contract cannot have an illuminated sign on the outside.
They out-fooled us on the supermarket technique that you make big paper
posters and paste them in the window, so it has a lot of cheap signs when you
P: And two drink stands outside.
B: You learn as you go and we could do it better this time. But all we could say was
that in developing the waterfront we had to bring in the things that people need in
their modern life. When my mother bought groceries living in Siasconset, she
used to call the market in town and say, "Mr. Ashley, I would like this, this, and
this." She would call him at nine-thirty or something and he would say, "Well, I
will have it there by four o'clock, will that be earlier enough?" She would say,
"Yes, thank you, we will have time to fix it for supper." Well, people do not live
like that anymore.
P: Nobody delivers groceries.
B: Now, you or your wife go in the car and get them. But that means you have to
have a market laid out for self service and you have to have a place conveniently
near to park your car. A self service market, 10,000 feet is a minimum. There
are a lot of chains that will not build a store under 30,000 feet. There were not
any colonial stores that were even 5,000 feet. So the problem in introducing the
modern facilities is to keep trying to bring the scale down. If it is not truly brought
down, at least bring it visually down. Put the modern facilities in as inoffensively
as you can. That is why if you go down by the A & P here, you will see that the
parking lot is very intensively developed and landscaped; to break up the
appearance of all the cars. That was recognized--we got an award from the
American Horticultural Society for the most beautiful parking lot in America, some
years ago. But, you have to do a lot of trick things to keep those kind of facilities.
P: Where did the cobblestone streets come?
B: Well, the real cobblestone streets, which Main Street is the principal one, was
paved. Cobbles are actually river rock. They do not want flat rocks for paving a
street. They want rocks that are rougher, sort of carrot shaped, or diamond
shaped--there is a point down in the ground. Then they are not apt to turn when
then the carriage wheels over the top. They want the top smooth, which does
not mean flat. So, the natural material is rock that has been tumbled in a river for
hundreds of years. So most of the New England seaports were paved with rocks
that they collected in the mouths of the New England rivers. They would send
little boats or sloops or something to collect them. They would sail in at low tide
and then sail off at the next high tide. Most of the streets here were done that
way. In modern times, unfortunately, we covered a lot of the streets, right over
the cobbles with tar.
P: Black topped them.
B: To make it smoother, that is one of the modern pressures.
P: Is that true of some of the streets here in Nantucket?
B: Yes, I think the street that you are staying on, Coffin Street, has cobbles under
the black top.
P: Now, was Main Street ever covered and then had to be uncovered?
B: No, when macadam first came in, Main Street was still in cobblestones and the
town could not afford macadam
P: So, it has always been like that.
B: Well, ever since it has been paved. It was a sand street back in the early 1700s.
But it had been in cobblestones for many, many years.
P: Was it always as wide as it is?
B: I do not think so. It was irregular in its width in earlier days. We can go across
the street, there are engravings before the fire that show it. But it has had those
lines since 1846, since the fire.
P: Walter, where did the trust, and later Sherburne, get its advisors from, the
historians, the architects, the landscape people and the designers and so on?
B: Well, Sherburne worked with a number of different architects. We have an award
from the AIA for community planning that was given to Sherburne Associates.
That was a funny story. A Mr. Erbonne, who I have never met, but who I am told
is an architect of fame and distinction, was chairman of the nominating
committee and he nominated us for several years for the award for community
planning. The directors of the association turned it down one or two years and
said, "That is not really community planning it is private enterprise." Mr.
Erbonne, apparently, was a man who in addition to being a man of distinction,
was a man of stubbornness, and kept resubmitting the nomination. He said, "I do
not care what you call it or who did it, but the result is community planning." So,
finally they gave us the award and they sent a committee down here to talk about
it before we got it. The committee came in to see me and said, "Well, Mr.
Beinecke we see by the records that you have had at least eight architects. Are
you really that difficult to get along with?" I said, "Well, do you not understand?
It is very simple. The better and greater an architect is, the more distinctive he
has developed his own language, his own trademarks." A classic example is Ed
Stone [American architect, 1902-] and his fenestrated stone walls, like the
embassy in India that made him famous. I said, "What we are trying to do is
preserve and, if necessary, fill in some of the holes in an old community." And in
the old communities they did not do that. A building was built by an owner and a
contractor or just by the owner himself. Their materials were relatively limited
and their techniques were relatively limited, but there were always slight
differences. In other words if we have a sidewalk that is 200 feet long and there
are four shops facing it. Each shop was built at a different time by a different guy
and one may have laid the bricks in his sidewalk in a herringbone pattern; the
guy next to him in straight lines; running bond would be the technical expression.
But, I said there was no master plan that said we would have a 200 foot
sidewalk here with a light pole at each end. So I said, "It is very important to us
not to look like somebody's master plan with the same lighting fixtures
everywhere and the same patterns in the sidewalk or the same gutter details on
the face of the building. I said, "Unless we want to be completely artificial about
it, the way to do it is to have different creative people." They understood that and
on the basis of that, we got the award. I was black-balled because I was too big
a bastard because I could not get along with an architect, was their theory.
P: So you used a variety of private architectural firms, where did the rest of the
expertise come from?
B: For what?
P: Who did the historical research, who did all of the other things? Where did the
(Frank) Blair Reeves [Former Professor of Architecture, University of Florida] of
this world come from?
B: All right, well, the federal government has a program called the HABS (Historical
American Building Survey), are you familiar with that?
B: Do I have to explain what that was?
P: Well, you can say something about it for the tape.
B: Well, it started in the Roosevelt administration. It was an effort to provide work
for architectural professors and young architects. The government's approach
was to encourage every state in the Union to identify the architecturally important
assets that it had and to inventory them. The concept of inventorying them
meant not only just listing them, but inventorying them in a technical sense
meaning make measured drawings so that if the building disappeared, you had
everything necessary to completely reproduce it down to the moldings, the
hardware, the pegs in the floor and what have. It was an exacting technology
and also required a written history of the property. One of the horrible things that
we know today is that that program has been going on since the 1930s and it still
goes on; they are still doing the work. As a nation, we have torn down the assets
just about as fast as we have recorded them. Literally the present inventory,
although they have been adding to it every year since 1933 or 1934, the
inventory is on longer than it was in 1934.
P: As far as surviving buildings. So did HABS come in here?
B: The Nantucket Historical Trust recognized this as a significant effort and felt that
we should be involved in Nantucket. The program was run by the Department of
Interior. The National Park Service Division and they used to send professors
and teams from different architectural schools around the country. As Nantucket
Historical Trust, we played the role that was called for by the Park Service that
there had to be a local sponsor that would match the Park Service efforts.
Nantucket Historical Trust undertook to be that partner. With the Department of
Interior we had, over a period of seven years, teams from Cornell and Columbia.
Finally we had a team from the University of Florida headed by Blair Reeves.
P: Now they did both private and public buildings, that is residences and commercial
B: If a private building was felt to be one of the assets, then they would solicit the
approval of the owner and, in most cases, usually got it. If they are private
homes, very often the people were flattered to know that their building was
recognized as being of such significance.
P: So this is how you and Blair came together, when he brought a HABS team up.
B: Blair came with a HABS team.
P: Just out of the blue?
B: I think he was probably the fourth or fifth team that we had. By the time he had
been here a year or two, counting his predecessor's programs, we had more
buildings than the Library of Congress, which is where all of these materials end
up; from the Park Service they go to the Library of Congress. The local group
gets to keep a copy and the Library of Congress gets the originals. We had more
buildings in the Library of Congress than any other town in the United States.
P: I suspect you have more that have survived than almost any other town.
B: Yes, we do.
P: So that is how Blair enters the scene?
B: That is how he first came to us.
P: It was in the 1960s?
B: The late sixties, yes. Then Blair taught the Park Service, the Department of
Interior, a new trick because he said we were only recording individual buildings
and that does not give the whole picture. He got them to redesign the federal
specifications so that they began to take a look at streetscapes, neighborhoods.
So that is was not just showing one individual building and saying this is great by
itself, but how it related to what was around it and what was the streetscape,
what was the street furniture--meaning benches, paving, curbing, landscaping.
That you showed the picture of a town or a neighborhood and not just one
P: So this is where parks and green space came in.
B: That is right. This was a contribution of Blair and the University of Florida
to the federal standards. Because the federal standards were rewritten
and they now use that concept everywhere, but this is where we started it.
P: Up until that time you had had no contact with the University of Florida, except of
course I understand you had a ranch.
B: I had an entirely different kind of contact that was very important to me and was
interesting to the University because I was in the ranching business in South
P: I want to hold that because I want to get that whole thing on tape.
B: But that predates what we were doing here.
P: So you knew that there was a university then. So when Blair makes the
B: I knew and was indebted to the University of Florida.
P: So this just strengthened your indebtedness, then.
B: I knew it as the agricultural college, this was a new chapter, dealing with the
P: You and Blair then, hit it off well, right from the beginning, did you not?
B: I can only speak for myself and the answer is yes, very affirmatively. But Blair
opened, as I told you, the federal sites and then he opened our sites here. He
also opened the University's eyes. As the program went along under the new
federal specs, it became clear that it was also an enormous educational
opportunity. We kind of drifted from the federal programs to Blair's concept of an
educational program. Of course that made great sense, because in those days,
Blair was chairman of the National Trust's educational efforts (National Trust for
Historic Preservation in Washington). He was the head trustee of that and was
chairman of their educational efforts. I think that about that same time he was
the chairman of American Institute of Architects preservation interests.
P: And was also serving on the Review Committee in Florida for the historic sites.
B: He broadened the interests here so that we were used to the idea, at that point,
of architectural students; because that is what they had been using in these
HABS teams. He simply proposed that merely instead of just using them, that
they be given--part of it was that they were getting an education anyway, from
the beginning that was the concept. But he proposed getting it put together in
such a form that it became part of their formal academic training and it qualified
P: Did it cause any waves that they were bringing up each summer this group of
"cracker" boys and girls from the south who were peering around in old houses
B: Well, from the beginning it has never been a "cracker" bunch of boys and girls.
P: Mainly they were from the south to begin with?
B: My impression is that Blair was always very aggressive from the beginning about
having people from all over.
P: But the point is, that this created no problem as far as the town was concerned.
B: Quite the contrary, it has always that the summer life here is so fast moving that
the Preservation Institute has always had much more recognition outside
Nantucket than in Nantucket. The majority of the people here do not know
anything about it. It does not making any noise or splash locally, it just does its
business. But on a national basis--well, every state has a State historic
preservation office that they call SHPOS. That is the euphemism for State
Historic Preservation Office. They have them, because if they do not have them,
they do not get in on the federal programs. Out of the fifty states, seven of them
are graduates of our little program. This is a town of 7,000 people, we only take
fifteen students a year. It is disproportionately important in the preservation
movement all over the United States. But locally, nobody knows or pays much
attention to it.
P: Walter, is this the moment on the tape that we should talk about the transition
from the first programs that Blair brought in to Nantucket, into PIN.
B: Well, I think that is what we are in right now. I think this is the one you want on
P: I am going to talk to Blair too, of course.
B: I have not and never have had anything to do with the course content of the PIN
program. It is my understanding that Blair has always conducted it so that the
work the students do when they are here is of an academic quality, that it
warrants certification by the University of Florida so that the young people who
participate in those courses receive academic credits that they take back to their
schools at home. I know in prior years it ranged from California to New Jersey.
My contacts with it--I have been invited every year to talk to the students about
local conditions and preservation from the point of view of how you structure it in
a little town like this. I have become, both at Nantucket and elsewhere, a
speaker on the relationship between preservation and commerce. Some of
which you and I covered earlier. I really could not answer a point in question as
to how he developed the curriculum.
P: But how did you fit into the rest of it, not the curriculum, but the rest of the
B: I have had some contact with introducing the program to people whose homes
Blair and the students decided they should record in the program. I have had to
do with the housing of the students and the housing of the faculty. The last
couple of years we finally have achieved the ultimate, in my opinion. We got a
historic building that we had to work out the financing of and then, very difficult,
the reconstruction and restoration of, so that the school has a suitable permanent
home. In the earlier years we moved it around on a very happenstance basis.
P: Where did you start?
B: We started, one year, in an empty store. Well, in HABS years, we moved in and
out of different empty stores, just taking whatever was available as a bargain.
Then we got into an old garage building and we were there for quite a few years,
six or seven years.
P: You rented the garage building?
B: It was property of Sherburne Associates and we gave the use of it to the school.
P: Did that have the space and the light and the other things that were needed?
B: Blair was able to make it do. He was able to have what he thought was an
adequate facility. It certainly was not attractive but it was adequate. Then
we got him into a building that was originally the Lancastrian school of the
community. They were there for several years and then finally, I guess it
was three years now, we got into a building that was the first building
rebuilt down town after the fire. It was built in 1849 as a fraternal hall for
the International Order of Odd Fellows. It is a group like the Elks, Masons
and things of that type.
P: Is that the facility that they are in now?
B: That is the facility that they are in now.
P: Who owns that building?
B: What it is now is a condominium. It is seven owners, six of them are commercial
spaces on the first floor. And the second floor is one ownership, the entire
second floor, and that is the preservation institute.
P: PIN owns the second floor then?
P: And each of the stores on the bottom floor, the first floor then are owned by the?
B: They own their own space. The trick was, it was a bootstrap operation. We had
to buy the building and then we had to undertake a million dollar renovation to it
because of oddities of legal codes. Legally the building previously was the place
of public assembly. As a place of public assembly it was legal to have up to 150
people on the second floor. When we said it was going to be a school it came
under a different state law. We had to rebuild the building starting on the
basement floor and reframe the whole thing to a higher and safer standard.
Then running the framing all the way through the first floor we had to recondition
all of those first floor spaces. Then we had to sell the six units for enough money
to equal the cost of the building plus the renovation.
P: Is the condominium concept, as you are explaining it, and it was unknown to me,
used elsewhere commercially? I have heard of condominium apartments.
B: Well, particularly in your state, half of the apartments in Florida are
P: I understand the apartments, but I meant commercially for stores.
B: It is not as commonly used for commerce as it is for residences.
P: But it is used around the United States?
B: I think so.
P: So, it is not something that was just born here.
B: Well, I do not think we are unique, no. I do not know of any others, but I cannot
believe that it is unique.
P: Where did the students first live? I know that they have dormitories now. I have
not seen them, but I understand that they live there. Where did they first live
before that became available, and the faculty?
B: The faculty have three cottages on Coffin Street which is very near Main Street.
P: Well, I live in one now, but prior to that.
B: I think we have had those pretty much since the start of PIN. They were the
property of the Nantucket Historical Trust and we acquired them specifically to
get a program like the HABS started. Then we had some other Sherburne
residential space. Blair and Mary Nell, Mary Nell particularly, had been good
enough sports that they accepted--I will not admit to it being squalid, but certainly
not our most attractive space. We had been in different apartments and the
other visiting faculty.
P: So they did not have to live in tents on the beach.
B: No, if Sherburne had an unrented apartment, that would be tagged for faculty.
Students, I think, we had the dorms starting at the time we began the
P: Now, what role did you personally play? Could you be described as the
Godfather of PIN? I do not mean for you to be immodest now, but from a
practically and realistic point of view?
B: Well, I think that 'Godfather' in this part of the world is associated with a movie
about the mafia.
P: Well, I do not mean it from the point of view, but really the driving force?
B: No, Blair Reeves was the driving force.
P: Well, Blair was the driving force from the educational point of view. Who was the
driving force to provide these faculty cottages, the dormitories, getting the garage
space and all, was that not Walter Beinecke?
B: That was my part, but I would describe myself as an enthusiastic supporter or
admirer of what Blair was doing.
P: All right then, we will make him the mafia.
B: I saw a benefit to it in the overall concept of what I was trying to do with creating
as many things at Nantucket as possible which leant themselves to the basic
concept of preserving the architectural heritage here and of helping the
P: Well, all of this was achieving the goal, the dream that you had right from the
very beginning. It did take some dollars and it is my understanding that you put a
lot of dollars into the pot.
B: Yes, but I just told you the rationale was that it was enlightened self-interest.
P: I understand this, but I just want to be sure that the tape gets all of this.
Whatever the motivation was or whatever you were trying to achieve.
B: Well, we did and we financed it. It was financed again on the same basic
principals of leverage; you got as much for as little money as you could. In other
words, if I could get a top level architectural professor to run a school here and
the price of it was that I have one apartment in the business that we could not
rent because we had to give him a bed, that is what we did.
P: Okay, I buy that. I understand, right from the very beginning I have never
doubted you are a practical person. And that you do a lot of philanthropy but
there is also, I do not mean to say an ulterior motive, but there is a practical end
to all of these things. Where did you get the name PIN?
B: The first couple of months we called it Nantucket Preservation Institute. Then
Blair and I shared delusions of grandeur and we turned it around and said this
might be a model for a lot of things. We turned it to Preservation Institute-
Nantucket. That worked because subsequently your institution has built PIC,
which is Preservation Institute Caribbean. Now, again partly because of Blair's
urging and example the University of Hawaii is starting PIH, Preservation
P: It is catching on.
B: Yes, it is slow and hard. My father always said, "The first rule for success in
anything is outlive the bastards."
P: I think the date for PIN is 1972. I think the records show that. It has obviously,
over the years, been a very great success, has it not? Would you say that it is
doing the things that you wanted and that Nantucket wants it to do?
B: I told you a moment ago, I think culturally, it is a great success. That seems to
be recognized in the preservation movement. The character of people who have
leant themselves to Blair to be directors, he has had the president of the National
Trust, he has had the keeper of the National Register, he has had the director of
the Smithsonian Museum, he has had the head of Colonial Williamsburg. He has
had people from all sorts of fields that have felt that this effort warranted their
attention and their support. I told you, just one example of where some of the
graduates are. I think that is how most educational institutions measure
themselves; where do they go and what do they do. Those all seem to score
very highly. I always regret that neither I nor the university have given the
program enough support to make it better known here. I recently had the
privilege of having a chance to talk to your new president, Dr. Lombardi, about
the fact that I think the University of Florida misses the boat in not giving the
faculty here some administrative here support which would redound to the
university's benefit in both public relations and in fund raising. The point being,
that for the University of Florida, this is a point of excellence. And the University
of Florida, in a smaller way, a national position, is like PIN is here. It is not as
well known as it should be. Here is one of the great universities of America, and
sure it is cock of the walk in Florida, but you do not hear enough about it in the
rest of the country and it does some wonderful, exciting things. And this is one of
its points of excellence where it should stand up and beat its chest and brag.
P: Lombardi must have agreed with you.
B: He did not argue with me. But what I was trying to point out to him was, the
question commonly is asked--if you get people's interest at all, I mean most of
them do not know about PIN--but if you begin to tell them about PIN, the first
question for a lot of people is, "Well, what the hell is the University of Florida
doing in Massachusetts?" Well, the answer is that Nantucket is a national
landmark architecturally and Florida is major school of architecture and it uses
Nantucket as its field laboratory for its preservation programs. That all fits
together and makes sense to people and then the subject dies because nobody
follows it up. The point is that Nantucket, as a summer community, has a very
unusual category of visitor with a very high percentage of people who are leaders
on a national level and who ought to know more about Florida. And yes, Florida
runs the preservation program because of the integrity and quality of how it
relates to its architectural academic work. But they also ought to brag about it. It
is a place where they can get to a very select audience quicker. Let me point
out, for example--I make my points by telling silly stories--but the electric
company here sells ninety percent of the appliances that are used locally. And
the reason for that is the electric company has the only service department.
They can afford to maintain a service department because they move people
around. A man may be servicing appliances in the summer when there is a big
population, then in the winter he is a meter reader or something. An independent
serviceman cannot make a living here. He is overworked in the summer and
then he eats snowballs the rest of the year. Through that policy they have gotten
all of the appliance business. Well, a gentleman called up last year and said,
"Would you send a serviceman over? I have a GE refrigerator that needs
adjustment." The girl says, "I am sorry sir, we will not send a serviceman to you,
you did not buy it from us." He said, "What do you mean?" She said, "We only
service what we sell." Well, that has been the company policy and that is how
they got the lock on making so many sales. He said, "But it is a General Electric
appliance and you are a General Electric dealer." She said, "Yes, but you did not
buy it from us." He said, "Well, now the company has a new policy--we service
anything we sell and we service any free samples that the factory sends to the
head of General Electric." I mean a joke, a long winded story, but I am trying to
point out that the head of one the biggest companies, and we can go through the
roster of the people that we have here. I think we have three United States
senators who summer here.
[End of side D8]
B: So I was drawing on people from the business and commercial worlds. If you get
into the creative part of it, they can get a group of people, many of whom are
beyond just summer residents and are actually long-term, part-year residents.
Then they go away for the worst of the winter of something. But in the world of
music, in the world of writing, we have major American columnists here, we have
major American authors, we have two major American composers. We have any
number of important artists. Part of it, dealing with the economic part, and
remember, I told you earlier, we have to confine the number of people for
physical reasons, which means we have to deal with wealthier people if you are
going to have a constantly inflating, rising economy, this little town has to
participate in that inflation and have more dollars, you have to have the kind of
customer who has got the dollars.
P: You want the yachts and not the rowboats.
B: That is exactly it, a very good way to put it. Now, let me go on on that, what our
natural market. The richest group of people in the world is the eighty million
people that live in a triangle from Boston to Washington to Pittsburgh. Now some
of those people are so damn rich they can do anything. The Seychelle Islands is
the hot resort this winter; they hop in their private jet and go to the Seychelles.
Now some of the people are that rich in money, but not in time. The reason they
are rich is because daddy stays close to the fire. His fire may be Wall Street or
Washington, whatever it is, but he has to stay within a few hours of his work
place. Now, that brings you to Nantucket. Because how many quality resorts for
those people who need that definition, that they have to stay close to the fire?
Those are the ones we get, we get the people of great power in everything
except time. The reason they have power and money is because they do not
give time to other things. Those are the people who come here. But in that
group, you find many of the movers and shakers, the leaders, at least in the
Eastern half of the United States. My point is that Florida ought to be talking to
those people. You have one of your very small activities, probably the smallest
that I know of, but it is also in terms of quality, one of your most influential and
one of your best. When I say you, I am talking to you as the University of Florida.
So, the reason the program is not well known locally is because the faculty--Blair
when he was by himself starting all this and the people you have had here since-
-are doing the academic job. They do not have the time and maybe they do not
have the instincts, I do not know, but at the very basic part of it, they do not have
the time or energy left after they do what they are here for, to also take on public
relations and fund-raising aspects.
P: Time to go to the Rotary Club and talk.
B: Yes, if there is anything to say about the University of Florida to this audience,
the university should send somebody here to do it.
P: What role have you played in PIN, from 1972 to 1990?
B: We have been administrative support. Off-season, when none of your faculty are
here, we are the housekeepers. During that period, my biggest contribution was
working out this building which is now the permanent academic home of the
school. That was, with no modesty at all, it was quite a trick and a shoestring
kind of operation. I mean we had to float it. We bought the building on credit and
we have sold five of the six commercial units. Well, we bought the building on
credit, then we went into debt to do the remodeling. Which was about one million
dollars over the cost of buying the building. And we have successfully sold five
of the commercial units. We have one left for sale. We have prospects, but the
sale is delayed because we have a recalcitrant tenant in it whom we are fighting
with in court. I have to win a lawsuit or wait for his lease to expire, then we will
have cleaned it up, and from my point of view, it is quite successful, although it is
a long way from the original dream. The original dream was to get the building
cheap enough so that the school could be on the second floor and that it would
own one or more of the first floor units so that it would have some income.
P: The likelihood, however, of that now happening is not good, is it?
B: Well, what we have had to settle for is a partial success. We are going to end it
with the Preservation Institute owning the renovated, restored building second
floor, unit number seven it is called. They will own it free and clear with no debt.
They own the dormitories and three faculty cottages, free and clear. There is the
possibility that out of the sixth unit, the one that is still available for sale, we will
not only completely finish paying for this program, but that we will also have
some surplus leftover which will go towards funding a chair at the school of
architecture at Gainesville. The maneuvering is to try have that qualify. We
know that the cash portion can qualify under Florida's program of matching gifts
by the state legislature.
P: The Eminent Scholars Program, yes.
B: That they will match gifts, I think it is the ratio of one to two. In other words, they
will put up one third.
P: If it is on a chair, if $600,000 is raised, they will add $400,000. Actually they have
added a little bit more than that now so that it is a million dollar endowment. On
bricks and mortar, it is a one to one basis so that they match every dollar that is
raised for bricks and mortar.
B: Of course we are not bricks, we are wood. But they will not match the real estate
investment here because it is out of the state of Florida. The idea is that
corporately PIN will be dissolved into the University of Florida Foundation. That
way the cash part of the values will qualify under this matching program.
P: Is that what Bob Lindgren was doing up here with the group?
P: Now, PIN owns the dormitories and the three cottages now.
B: And the school.
P: Does that mean that the University of Florida formally owns these properties?
B: No, PIN is legally a Massachusetts not for profit corporation. Which makes it tax
exempt. Technically it is 503C2, is the federal designation. It has been that
since its founding. The concept is that in the relationship we have with the
university now, there is no reason to have a legal separate Massachusetts entity
with the consequent accounting systems and reports to the state of
Massachusetts as a charity. The university has never wanted to take title to
these things before, although it has been enormously supportive of the academic
part of it. Well, as I say, the school building now, it was a complicated real estate
transaction. There had been debts, there had been mortgages, there had been
sales. It has been a manipulation to make it come out this way. Now as soon as
we sell this last unit we will be in a position where we can dissolve PIN and the
university through, and I carefully said, the University of Florida Foundation, they
do not take an out of state asset they will not take in the name of the university.
P: Oh, I know. It has to go through the foundation.
B: But if they take it in the name of the foundation, for all practical purposes, it is
then the university's property. We will be able to eliminate accounting, we will
eliminate an audit fee. As a separate charity we have what amounts to a
duplicate set of books to what Florida would have.
P: When is this likely to happen?
B: Well, we hope before the end of the year.
P: So it is an imminent kind of a thing then When will the chair be announced?
B: That will depend upon fund-raising to be done from the college. We know that
we are not going to get enough out of the situation here to endow a chair. But
PIN has a separate and distinctive board of trustees at the present time. The
anticipation is that when the university takes title to these assets, we are going to
dissolve PIN and the people who are presently its legal directors are going to be
organized as the Friends of PIN or Friends of the University kind of thing.
P: People like Buddy Jacobs.
B: Buddy Jacobs is a good example. He is one of the Florida Trustees of PIN. He
also is anticipating doing some fund-raising.
P: He is already active in the fund-raising for Fine Arts.
B: He is proposing to do some for the school of architecture, which will help
complete this endowed chair.
P: How much do you think will come into the chair before this private fund-raising?
B: Do you mean how much will come from Florida?
P: No, how much will come from Nantucket?
B: Well, if we are lucky we might have $100,000 or $150,000 dollars in addition to
the real estate.
P: That is a very good start.
B: I think that is within reason.
P: Very generous.
B: It is our generosity, it is a matter of doing the job right. The building and its
improvements, the land and building cost something over a million dollars. I think
it was about a million and a quarter. The remodeling cost was about a million
dollars. We have gotten about two million dollars out of the five units that have
been sold. We actually got more cash than that but we got about that much in
principal. While we were doing this transaction, it took several years to get to this
point, so we had carrying costs. The chief of which were interests payments and
they have been paid as we went along out of the sales. So, the PIN at this point
still owes somewhere around $200,000. It will depend on how good a job we do
at selling this thing, what is left over after we pay all of the debts. I am wrong on
that the, $200,000 is low--we owe about $400,000. We hope to sell it for about
$600,000. So we can pay off the $400,000, closing costs and the broker and all
that kind of thing. We should have 150 anyway to go towards the chair.
P: That is very good, very nice. So, in answer to a question that I asked you earlier,
what has been your relationship to PIN from 1972 to the present, one of the big
answers is what you have just given me because you had been very much
involved in these financial arrangements.
B: Well, I told you I had been involved in the finances of it.
P: But it has been more than just a housekeeping activity.
B: Well, that is true. I also leant them my leg for a while. I broke my leg during the
construction of the building.
P: Well, I had not heard about that.
B: Oh well, two donkeys built a stair case. They built it like a piece of furniture,
horizontally on sawhorses and carried over and stood it in position. It ran from
the basement to the first floor. Just as they placed it in position somebody
shouted "coffee" and they walked off to go have their coffee and they did not
drive a nail to fasten it. They did not put up any warning or barricade or anything
and I came along and I was inspecting the building and wanted to see the
basement. I just went to the basement a hell of a lot faster than I had planned
on. I stepped on this thing and it took off.
P: You ended up with one bad leg as a result of that fall. Everything all right now,
with the leg?
B: You do not bounce as well after seventy as you used to, there is a penalty to it.
P: So, instead of doing six miles of jogging a day, you do four.
B: Well, I do not jog.
P: What do you see as the future of PIN?
B: The University's administration has made it clear that they would like to expand
the program. There are two ways of doing that. One is to expand the
seasonality. The last couple of years they have not done it, but in the earlier
days, Blair used to have seminars for people in preservation other than the
student architects. He treated those seminars as kind of like an overlay. He
would have them at the same time as the students were here, so that some of
the people in the seminars would act as guest lecturers. All of them would relate
to the students and it was very beneficial. Those people got a lot out of being
with the young architects and the young architects got a lot from them. Some of
those sessions were very useful. One we did was taken on a national basis. We
had a program called "Preservation for Profit." This was during the early 1970s
when everybody was excited about the Arab oil embargo.
P: 1973--1 was there.
B: At PIN?
P: No, were you not doing that in Gainesville?
B: Well, the program went national. We did the program here inviting bank officers,
mortgage lenders from insurance companies, and people like that. We were
trying to show them that preservation was enlightened self interest for an investor
or a developer who owned a historic building or just an old building. The oil
embargo was pertinent in that we reduced, for example, a brick wall to how many
barrels of energy it took to build that. That gave us statistics that at that time
were attention getting because everybody was very conscious about the oil
situation. You may remember, you had to stand in line to get gasoline for your
car and so on. The program worked very well here so the National Trust in
Washington took it national and they held it in some thirty cities. In Boston they
ran it for three days, they had over 3,000 people attend.
P: I remember it in Gainesville. You spoke, Carl Fice, was on the program, of
course Blair. Was Mertaug involved?
B: He would have been because he was a major factor in getting that program into
P: There were six or seven of you and I remember that program. That may have
been the first time that you and I met.
B: Well, I am flattered that anybody would remember my participation in it. Anyway
that type of program had a lot of outreach. We had other programs--using Bill
Mertaug we had a program for preservation administrators from all over the
United States that dealt with how they were supposed to relate to the federal
P: Were those held here in Nantucket?
B: They were held here at PIN. They all had interplay for the students, because the
state preservation officers and professional administrators from all over the
country, many of them were in the field that the students are aspiring. That kind
of thing worked very well. We cannot go the simplest routine of just plain
expanding the number of students because we have not got have enough
available dormitory space. So, if we are to get into anything more in the physical
plan, it is going to have to be in dormitories. But there is a consideration by the
university at the present time of planning programs to use the present facilities at
times other than when our young architect people are here. The program from a
Nantucket point of view is badly timed. PIN closes the program for the young
people early August which is just the height of our summer season as a
community. We should use those facilities for other people then. I believe the
new dean at Gainesville is studying, with Blair and Susan, alternate programs.
That would mean we could have a busier and longer use of the property and
more active program by the university without having to build more space, either
residential or class.
P: So all of this is under consideration for expanding PIN's program and whatever
directions it can take?
B: If so it will be more than just a summer workshop for students. Do any of the
participants, people like Blair and Susan, are they ever called upon within the
community itself, the Nantucket community?
B: I told you earlier I did not think the community is not aware enough of PIN. But in
certain narrow circles it is. The professional people in Nantucket, for example,
Nantucket has, for a little town, a very good planning and development board.
As a matter of fact, our local planning director has had national awards for some
of the constructive things he has done. We have been held up as a model
community for a lot of small towns that face the develop pressures and the resort
problems and things like that. He is leaving us now, I think it is next month. He
won a Loeb Fellowship at Harvard for a year. So he will be gone, but he and his
staff are very conscious of Blair and the school. They used the PIN students, for
example, to help prepare a handbook for building codes here and things of that
type. There is a following of people who are aware of the university and PIN and
its relationship who come to attend guest lectures at PIN. But it is a rather limited
P: Did not Roy Larsen live here or work here?
B: Roy was chairman of Time-Life magazines, lived in Siasconset and was probably
the moving spirit in the foundation of our conservation foundation. But he died a
few years ago, Mrs. Larsen is still here and he has two sons who
P: Some way I have connected him with the University of Florida also. I am not
quite sure in what way.
B: I am surprised of that. I was not aware of that.
P: I do not think in any formal way.
B: What does Harvard call those people? They are not trustees--are they
governors? Whatever the guiding body of authority at Harvard is, he was one of
them and very much committed to it.
P: He may have been some visiting professor or lecturer or something.
B: He was also very much involved in ornithology and donated bird sanctuaries in
Connecticut. Here in Nantucket his biggest contribution was that he was
probably the main spirit in organizing the conservation foundation.
P: What is this conservation? I saw the signs as we were driving around.
B: Well, in Nantucket we organized, about twenty-five years ago, the Nantucket
Conservation Foundation. The buzz word in those days was "forever wild." It
was an effort to take land and keep it from being cut up into house lots and
developed for commercial housing and so on. The program here was a failure.
There are similar groups all over the United States, who in terms of money, we
sound pretty small compared to some of the others. The Conservation
Foundation here owns about 8,000 acres. But 8,000 acres is more than a
quarter of the island. We have other conservation-oriented groups. The
Trustees for Reservation is the oldest conservation group in America. That is a
Boston group and they own 1,000 acres. Massachusetts Audubon owns 900
acres. Then just a couple of years ago the body politic caught up with the private
enterprise part of the system because our original Conservation Foundation is a
private, in the sense of that private is not governmental, it is public in the sense
that anybody's contribution is welcome and if you donate a dollar a year you are
a voting member. But in the sense of being related to funding, it is private, it has
no government funds. The total of conservation holdings, the different
organizations now, is over a third of the island. The biggest part of it being in the
Nantucket Conservation Foundation. Just a couple of the years ago the town
voted an organization called the Nantucket Land Bank. It took state legislation to
do this because the town legally cannot do it by themselves, but the gist of what
they did is they voted a special tax against buyers. That is good New England
rationale. You figure if somebody is selling land, it is apt to be a local guy, one of
your friends and neighbors. If he has got land he is apt to have been here. You
do not like to hurt your friends and neighbors, so you tax the son of a bitch from
out of town. So the tax is odd in that the tax is against buyers. If you buy a piece
of real estate here you pay a two percent tax. The tax does not go into the
town's general funds, it goes into the Land Bank. The Land Bank can only spend
that money for the acquisition of open space to be held as conservation land or
for beach frontage or rights of way, things of that type.
P: That will benefit the public.
B: To benefit the public. We believe, at this time, that by 2000 we will probably
have about fifty percent of the island in conservation holdings. Either the Land
Bank or the Conservation Foundation. It does not come in as fast it did ten and
twenty years ago because then you still had people who would give you a piece
of land and take a tax deduction of something. Now we have gotten most of
those and the prices have gone up so high that it is a burden on anybody to try
and give it to you nowadays, so a lot of them do not. We still raise money and
buy what we can. The Land Bank gets acreage every year through what they
accumulate enough cash from this tax structure to be active participants in the
market and buy inland. Legally they have the right of condemnation so they can
pick a parcel and make somebody sell.
P: Is the entire island a bird sanctuary?
B: No, certain portions. Most of the conservation land is. There is, I told you, a 900
acre piece that belongs to the Mass. Audubon.
P: So that this is a home for lots of wildlife and bird life and flower life.
B: Well, there is a great deal of interest for things like that here because Nantucket,
in plant life, has certain plants that do not grow in most other parts of the United
States. Our moors, for example, in springtime, are covered in scotch broom and
I think there are nine or ten different types of heather that grow in our moors
which is not common in the United States.
P: What is the makeup of Nantucket's population? I do not mean the tourists.
B: Well, there are several groups. There is the year-round resident. In the
vernacular, years ago, they used to talk about natives. Native was in one sense,
if somebody from off island used to word, you were talking down to the local
population, but also there are people who use it as a brag, "I am from here and
my great grandfather came on the Mayflower and I have been here three
generations and that is a privilege." Nowadays the word is not heard much, but
we refer to year-around people. Our year-around population is something
between six and seven thousand. Population figures here are hard to know
because for many years they have been overstated because in Massachusetts
liquor licenses are allocated by the number of your population and the provision
allows seasonal licenses. So the summer population, at least, was always
overstated because they wanted to justify more restaurant licenses.
P: You would be classified as a year-round resident?
B: I would, yes. That is not "who you are descended from" or "where you born
here." That is probably a statistic. You either live here and this is where you are
registered to vote or you are not. I have, for the past ten years, have been a
year-round resident. But then the population swings from something less than
7,000 to a high of, I suspect it is around 35,000. There are people who say it is
as high as 40,000. There is about 2,500 people a day who come and go the
same day. That is the trippers who come over on the boat and take a bus ride. It
is just a very pleasant trip if you are spending your vacation on Cape Cod and
one day you take it and say, "Well, I will go see the islands." It is a nice boat trip
over and you tour the island and then you take the boat back again. They do not
affect the island much, except by mass. The bodies of them moving around in
buses. Then they support a restrictive number of shops, like most of the United
States, that caters to tourism. It is the junkier kind of stuff. The fudge shop, the
T-shirt shops and the bicycle rentals, all of those being down around the wharfs.
We have a large group of people who are vacationers. Vacationers come here
five, ten days and stay in the rooming houses (which is a major industry here) or
the hotels. There is less hotel capacity than there is rooming house capacity.
They support many shops and many service places.
P: Can they rent places like your family did in earlier years?
B: Most of that would be the next category. The ones that I am speaking of are
vacationers of relatively short stays. Those are factors that are beginning to
fudge because the other classification I would have said next was summer, either
renters or homeowners. In numbers they are statistically fewer, but economically
they are far the most important. The people who own a summer home here or
who rent a summer home here--and that category is changing, it used to be that
renting a summer home meant that you rented it for July and August. You
negotiated with the landlord and said "well, I really want to come in June." So
you got the last ten days of June for nothing. Because if he rented it to you for
July and August there is not much of a chance of his finding something for two
weeks in June. But nowadays with the pressures and lifestyles are changing,
there are more people who rent for a month, the half summer, than there used to
be. But the people who actually rent homes, or even more important, the people
who actually own summer homes are economically the most important parts of
the community. They are the ones that maintain the more important shops and
stores. They are the ones who maintain the building trades people, the plumber,
the electrician, the maintenance people. These definitions are becoming
confused. The last few years we had a tremendous building boom. So much so
that the workman were routinely flying in here. You could go out to the airport on
Monday morning or Friday evening and see them arriving with their tools or
departing with their tools on Friday. There were as many of them as there were
P: Your professional people, your doctors, lawyers, and accountants, they are year-
B: They are year-around folks. Again that all changes. Thirty years ago there were
three lawyers in town, today there are thirty.
P: Who can afford to live here?
B: I identified the market for you earlier, I told you the richest group of people in the
world is that seventy million people that are between Boston, Washington and
Pittsburgh. If you figure it out--let's you and I do it together-- Nantucket gets
about 400,000 visitors in a year and something more than half of them are of not
major consequence economically. Those are the day trippers. But I mean we
get 2,000 or 2,500 of them on a busy day. But I have not seen current market
figures, but I remember a few years ago that people in that category spent twelve
or fifteen dollars a day. All right, well that gave you a multiplication factor as a
opposed to a business executive who has a summer home here, who would
spend thousands of dollars all through the year on a caretaker that painted or
opened or closed his house or something. Then when he was in residence he is
patronizing the grocery stores and the liquor stores. His wife is shopping for
either pleasure or staples, whatever the case may be. You know, one or two
families like that equal a couple of hundred trippers.
P: Are these the people who we are talking about living in the historic residential
area? Eighty-five percent of our taxes are paid by non-voters. That is always a
friction problem here. There are states like Connecticut where you can vote in
local elections on the basis of being a landowner, whether you are a resident or
not, but Massachusetts has no such provision. So, unless you are willing to
register yourself that this is your legal full-time residence--and many people are
loath to do that because Massachusetts is also known as "Taxachusetts." It has
an onerous income tax burden. So many people who own a summer home here
prefer to keep their legal residence in..
B: ... Florida or, I just participated in an argument this winter, our local bank, we
are arguing that we have too many, too old directors. Half of the board are men
who have fulfilled their life ambition. Having grown up and had businesses here
and with prosperity have now reached the point where they go to Florida for the
winter and it is so advantageous, tax-wise, to prove that it is their principal
residence, which means that they spend six months and a day there as a
minimum. That gets them out of the Massachusetts tax roles, but it also takes
them out of the activity here. The bank director who is living in Florida is of no
damn use to the local bank. He is not participating in the community life and a
director should work from two points of view. He should work as, what the word
director means. He should be participating and making management decisions
at the bank board. But since he is not living in town he does not know everything
that is going on, the way he should. It works the other way, directors should be a
conduit between the public and the institution and help get the management word
of what the town needs and is doing and what is happening. When you detach
yourself from the local life you cannot play that function either. I am not trying to
get into the bank subject with you. But I mean here is one of the preeminent
local business institutions and half of its members have fallen for this Florida trap.
P: Well, I just see that the little bit that I have seen, shows me houses beautifully
kept, lovely lawns and gardens and I see the pictures of the interiors of these
properties and I can see that they could only be maintained by people of wealth.
So I am just wondering, there are no longer any poor people here?
B: Thirty years ago I could count on my hands how many people in town made
more than $12,000 a year.
P: Now can you count on your hands those who make less?
B: Probably. Of course almost nobody does now. Like everywhere else in the
United States, we have all sorts of what politicians call safety nets. We have
local people, now, who are millionaires. I mean a millionaire has gotten to be
rather an amazingly common commodity in the United States nowadays. A man
who used to be associated in business with me, he was the superintendent of
grounds department. In other words he kept up the gardens at the hotels. He
had a green house that provided floral things for the shops and so on. He left us
amicably, but he went into business for himself. He said, "This is the only place
in the United States I know where a gardener can be a millionaire." He has done
very, very well. People have opportunities here because of the wealthy clientele.
Well, you see three years ago, I went to a famous consulting company in New
York, Management Engineers is the great name. I said, "What can a little town
like this do. We should be having more money. There people are in actual need
here, the town is in deep depression. It should be an attractive, successful resort
commercially. We have wonderful assets." I gave them the historical
preservation story and the character of what we could be. And they said, "Well,
you have to have attractive shops. Because shopping today is not something
that has to do with staples. People do not go buy rice and potatoes and
everything all the time. That is not just what shopping is now, shopping is part of
a vacation experience. People shop for pleasure and you have to have attractive
stores to produce customers." I said, "Well, how do I get attractive stores?" Well
the answer was, people who are entrepreneurial-minded have to see attractive
customers. Well, what is an attractive customer. That is somebody with money.
It is a chicken or egg cycle. I cannot have the merchants until they see attractive
customers and you cannot have the customers until they see nice shops, how do
you break the cycle. I thought about it and came to the conclusion that this is
seaport. Part of what I wanted to do was to clean up the waterfront and restore
life to the waterfront. So I figured that was the first place to begin because that
would attract yachts. Well, by definition, if you have a yacht, that is almost an
automatic definition that you are wealthy. The joke used to be that a yacht is a
wooden hole in the water that you pour money into. Even if you are not wealthy,
you are on a yacht, you must have wealthy friends. So we concentrated on
cleaning up the waterfront. Not in Nantucket language, but in strictly hard-nosed
real estate development language, what we did was build a shopping center in
this decrepit old industrial area. It was not old enough to be historic, it was all
1900 and post-1900. It was tacky and did not fit the present needs or present
desire. A big piece of it was an ice plant. Well, at one time in 1900 they needed
an ice plant, in 1800 they needed an ice plant. Everybody had iceboxes. But
nobody has iceboxes nowadays. That is a generation gap question. If I asked
the kids to get me a beer while the commercial is on the TV, I say "Get me a beer
out of the icebox." They say, "I will go to the refrigerator." We did not need the
ice plant anymore. But the way an ice plant was built, it could make sixty tons a
day. And its sales the last year it was there were 240 tons a year. It occupied
this enormous piece of the water front. Even to industrial archaeologists, it was
not of any interest. It was not old enough to be on the register or anything like
that. So we tore it down and what we really did was we built a shopping center (I
would never use that language around here). Around it we cleared land and
made a parking lot and built around it a supermarket, a liquor store, a five and
dime, and other kinds of gifty shops. And half the area was a parking place for
boats. Well, now the great market on the east coast for yachts and boating is
really from the Chesapeake Bay to Cape Cod. If you will look at a map, Cape
Cod sticks way out into the Atlantic. Above Cape Cod is a separate market, that
is the maniacs. The people who like to sail the coast of Maine and down to
Boston and so on or to Plymouth, but very few people want to go around the end
of Cape Cod. It is dangerous in a small boat. It takes a real navigator and a
seaman. You can go through the canal but that is an industrial kind of
experience. It is not fun and yachty. The big market comes up the Jersey coast
and off Long Island Sound, this wonderful protected passage; stop at all the
Connecticut and Rhode Island and southeastern Massachusetts ports.
[End of side E9]
B: As soon as we started producing the right facilities, yachts started to come. As
soon as yachts came, there are always people looking for economic opportunity,
there were enough bright eyed entrepreneurs who saw people there. They saw
maybe fifty yachts and said, "Well, there are fifty yachts that come and they
seem to average stay two or three days. That really means there are 180 boats
a week there. And certainly on those boats there are probably thirty ladies that I
could sell a fancy sequin sweater." So they open a shop for fancy sequin
sweaters. That is how the thing builds up. The lesson I had to learn in between
was, after I decided that I wanted to clean up the waterfront--you had asked how
did I find advisors and consultants. I went back to the management engineers
and I said, "Who is the best expert in the United States on marinas?" They gave
me a guy's name and it cost $5,000. This is thirty years ago, that was a lot of
money and I got a beautiful report. It was not even typed. It was printed in a
leather binder with our name stamped on the cover. Remember there were no
wetland laws thirty years ago. What it said was, "The way to build a marina is go
into the cheap land on the edge of the harbor where it is marsh land." The
expensive part of building a bulkhead is that you have to build a foundation
structure behind it to support it. Because a bulkhead is a wall on which the
pressure changes. At high tide the water is pushing back against the land and at
low tide the land is pushing the wall out. So you have an elaborate structure
underneath and behind. It costs a lot of money to excavate and do that. So the
smart thing is to go into cheap marsh land, build the whole thing out in the open,
then you bring in a dredge, excavate in front of it so you get the water depth you
want. You put the material in back of it and you build a platform for whatever you
are going to do. That is the way to build a marina. I looked at it and I said, "I
have never been a yachtsmen. I have never run a marina. I am a peddler, I am
a salesman. But I know this is wrong. It is just far enough out of town that
people are going to feel ripped off that they have to wait and pay for a cab to go
in town to get to a grocery store. It is too far back for them to be hot and sweaty
and carry the grocery bags and when they are out there, they are nowhere. They
might as well have stayed in Connecticut or New Jersey or wherever they were.
Who wants to live out in the marsh. It is not related to our historic town or
anything else." I stuck the thing in the drawer and I waited until two years and
saved up a little more money and I went back to the experts. I said, "Who is the
second best expert in marinas?" They gave me another name and he charged
less. His report was in a plastic binder and it said the same thing. Then I had to
think. My father used to ask me if I was making mistakes. If I said, "not many,"
he would chew me out. He would say, "That means you are not doing an awful
lot. There is nothing wrong with making mistakes. Just do not be a jackass and
make the same one twice." I obviously had made the same mistake twice. I had
the two best firms in the United States, they both told me the same thing, so what
was wrong? The odds were it was not them, it was the question. I had asked
the wrong question. Now my question had been, "How do you build a marina at
Nantucket?" What could you argue about? I had to go back and think it out.
Marina was the wrong word. I went back and said, "How do you rejuvenate the
waterfront at Nantucket?" It came out entirely different. You had to have the
same modern things that marinas have. A marina is a modern haven for
pleasure boats. But if you build a modern marina for pleasure boats in California
or in Florida, it is slick, it is plastic, it is fluorescent, it is cold cathode lighting, it is
concrete, it is stainless steel. This is an historic community, we did not want
something like that. What I had to do was rejuvenate the waterfront. I had to put
in all of the same things that a modern marina has. Every slip has running water,
it has twenty-four hour telephone service, it has plug in cable TV. It has 110
electric service, it has 220 electric service, it has a plug in sewer. But it is not
done in concrete and steel. We preserved as many of the old fishermen's sheds
and everything else. Anything we had to build new we built in replication of the
old stuff so it is all in wood. Usually a marina has a cyclone fence around it five
feet high and is on the chief plan. We put it right on the end of the main street
and people do not know where the street stops and the boat basin begins. I took
the name boat basin after I had such an expensive distaste for marina. Then we
did things like--to try and make it still seem like a real port--we had commercial
fishing boats in there. We put them right in with the yachts. Some guy comes in
with his ninety-foot fancy yacht and he and his wife sit on deck and have their