1920s building an opera house as ambitious as his business empire: a forty-five-story giant equipped with electric elevators designed so that every seat in the house, including the high gallery seats, would offer as good a view as the dress circle. Insull’s opera house had no boxes for aristocracy; he wanted to prove that the world of electricity was a democratic one. The plans revealed a building in the shape of an armchair, a symbolic throne for Insull. The armchair faced west, the ultimate gesture of defiance toward New York.
On Wall Street, there were other, different figures to watch. Henry Morgenthau Sr., Felix Warburg, and Bernard Baruch were joining the Morgans as leaders in the financial district in the early part of the century. Some were continuing the success of a dynasty—Warburg. Others were bent on establishing new dynasties—Morgenthau especially. In the 1920s a young man named Alfred Lee Loomis had taken a firm that was nearing bankruptcy, Bonbright, to heights of profitability with innovative investments in Insull’s industry, public utilities. Half of the nation’s homes were electrified; together with his friend and partner Landon Thorne, Loomis wanted to electrify the rest. The industry began recruiting talent wildly. One of its finds was a corporate lawyer who had worked for Firestone, one of the tire companies in Akron, Wendell Willkie.
Like Insull, Alfred Lee Loomis and Thorne had seen that older investment houses were not sure they wanted to pour cash into the new utilities industry. And like Insull, they had seen the efficiency ofholding companies: little local companies could save cash if they banded together into “superpowers.” One of the most promising markets, they had recognized, was the South, a laggard in modernization. Electrifying the South, they had realized, would also do enormous social good. As it was often said, the South was tired of living in the dark. Lone state companies could not do the work; they needed to hook up a network and share resources. Georgia Power Company had provided indifferent service to some customers, in part because it lacked the advantages of a larger holding company. One customer who wrote to complain was a polio patient from Warm Springs, Georgia—Franklin Roosevelt, the future New York governor.
In the 1920s two other big figures loomed large. The first was the treasury secretary, Andrew Mellon of Pittsburgh. Mellon’s father, whose family had come from county Tyrone in Ireland, had been a faithful reader of Benjamin Franklin: “The way to wealth, if you desire it, is as plain as the way to market. It depends chiefly on two words, industry and frugality. That is, waste neither time nor money, but make the best use of both.” Thomas Mellon, a merchant banker, believed in investing in commodities, but also, like Insull, in investing in ideas. Among the new bank’s first visitors—while Andrew was still a student—had been a twenty-one-year-old bookkeeper with a scheme to build fifty coke ovens. He thought he could serve the growing steel industry, but he needed $10,000. An agent whom Mellon sent to evaluate Frick wrote: “Lands good, ovens well built, manager on job all day, keeps books evenings, may be a little too enthusiastic about pictures but not enough to hurt.” Judge Mellon struck a deal with him.
That man, Henry Clay Frick, remained affiliated with the Mellons from that point on. He and Andrew, good friends, traveled to Europe together; on such a trip Andrew started to build an art collection, buying his first picture.
But what was more important at the time was that Andrew also built a great business empire. He and his brother Richard created first a national bank, then a steel concern, and then an empire. YoungMellon cornered the bauxite market. He shared in the profits of Carnegie Steel, of which Frick was president. The Mellons together established the enormous Aluminum Company of America; later they picked up Bethlehem Steel.