Library of Congress
George and Martha Washington—here in an engraving after Alonzo Chappel’s painting—sat atop the eighteenth-century 1 percent.
Library of Congress
Washington's surveying office in Stafford County, Virginia, as drawn by the Historic American Building Survey.
A plat drawn and signed by George Washington. Washington’s great wealth in land grew from his surveying days.
Library of Congress
A nineteenth-century map of Mount Vernon, showing the property, home, and tomb of the first president.
Library of Congress
Washington retired to the life of a private farmer, albeit a wealthy one, after his presidency, like Cincinnatus of ancient Rome.
How Did Washington Make His Millions?
by Andrew G. Gardner
It might sound impertinent, perhaps irrelevant, to ask how much George Washington was worth. After all, his value is better measured by his service to his country than by his pocketbook. Nevertheless, when it comes to money, his countrymen can be a curious lot. Witness our interest in such things as the list of America’s richest annually published by Forbes and Dun & Bradstreet’s corporate ratings, as well as the readiness of newspapers to print salaries gleaned from government forms. There are Internet sites with all manner of personal and historical financial tables that stretch from ancient Rome to today, tables that compare the Rockefellers, Carnegies, and Gateses of the world to William the Conqueror—estimated fortune $200 billion—or Marcus Licinius Crassus of Rome—about $20 billion.
So where does the United States of America's first president fit into the grand scheme of wealth assessment, and how did he get there? Some purveyors of legend have it that he was the richest American ever. Others suggest that he was but the wealthiest American of his time. Certainly, in his later years Washington could claim to be a wealthy man, and when he died in 1799 his estate was pegged at about $780,000. But it is an estimate. In a schedule of property that accompanied his twenty-eight-page handwritten will, Washington lists the properties and holdings he wishes sold and what he thinks they are worth. There is real estate from Virginia to the Ohio Valley to New York to the District of Columbia, $35,000 worth of shares and bonds, as well as Mount Vernon livestock. The total is $530,000—an enormous sum for the time. But this figure is only part of the first president's financial snapshot. There is no valuation of his more than 7,000-acre Mount Vernon estate, which was divided among relatives, or the value of Washington's 123 slaves, freed in 1801. Since the estate was not in dispute and there were no taxes to be levied on it, his executors were not forced to assign market values. So, included in the figure of $780,000 is Washington's own appraisal of what his holdings would fetch—that $530,000, plus an additional, unverifiable figure of $250,000 that historians have computed for the rest.
Most of this wealth can be traced to Washington’s success as a land speculator, an enterprise that grew out of his early career as land surveyor. Added to that was his firsthand experience of the frontier country beyond the Allegheny Mountains gained during the French and Indian War. The area’s potential, strategically and economically, made a lasting impression on the young officer and was the key that opened the door to financial opportunity.
Washington's first land purchase was of almost 1,500 wilderness acres on Bullskin Creek in Frederick County, Virginia, in 1752, when he was just out of his teens. That year, after the death of his half-brother Lawrence, he inherited an interest in the Mount Vernon family domain. He built the estate to more than 7,000 acres with a workforce of 316 slaves—less than one-third of whom Washington owned, 153 belonged to the estate of Daniel Park Custis, and 40 he rented from a neighbor. For the rest of his life he added to his land holdings, particularly along the western frontier he knew from his soldiering days.
To recruit Virginians for the army during the French and Indian War, Governor Robert Dinwiddie had in 1754 offered 200,000 acres of frontier land for those who joined. After the war was won, the governor reneged, but after years of lobbying Washington forced the authorities to honor their commitment, securing title to more than 23,000 acres in what would become West Virginia. By the time he died, Washington had more than 52,000 acres sprinkled from New York in the north, through Pennsylvania and Maryland, to Virginia in the south, and Kentucky and the Ohio Valley in the west, something above eighty-one square miles.
According to Michael Klepper and Robert Gunther, authors of The Wealthy 100: From Benjamin Franklin to Bill Gates, those acres translated into wealth that put Washington at number fifty-nine in the list of top 100 wealthy Americans through the ages. John D. Rockefeller Sr., the oil-refining magnate, and Cornelius Vanderbilt, the railway builder, head the list. John Hancock and Benjamin Franklin are the only other Revolutionary-era names among the top 100. Hancock is fifty-fourth, and just beats Washington to the post as richest colonial American. Benjamin Franklin’s publishing interests, as well as his Philadelphia land holdings, elevate him to eighty-six. These rankings reflect not just the dollar value of each man’s estate but also the ratio of each man’s wealth to the gross domestic product—in effect, how large their share of the national pot was at the time. The Wealthy 100, however, bases its calculations on the $530,000 figure in Washington’s will, and underestimates his financial clout.
Today, two hundred years after Washington’s death, a $780,000 estate is an unremarkable legacy, but inflation has played havoc with our ability to compare values across the years. Thanks, however, to the work of a team of monetary and economic historians led by Professors Laurence H. Officer and Samuel H. Williamson of the University of Illinois at Chicago, there is a trove of data that goes a long way to helping convert old dollars to new. If we use their database, Washington’s $780,000 net worth can be reassessed to give us a better understanding of his relative standing in history’s unofficial Financial Hall of Fame. Translated to 2010 dollars using the consumer price index, the roughly three-quarters of a million dollar estate takes on a relative worth of $14.3 million, in itself not particularly large by today’s standards. That figure, however, amounts to one small part of the picture, according to the economists. Analysis of the “economic status” of Washington’s late eighteenth-century fortune aims to measure the relative “prestige value” of his wealth compared with the net worth of an average American citizen of the era. That figure amounts to $429 million in today’s money, and begins to reflect the serious wealth that the first president accumulated. It’s at this point that things get interesting.
The third measure suggested by economic historians assesses what they call the economic power of Washington’s holdings, or roughly translated, “What was the president’s financial position relative to the size of the economy?” At the time of his death, Washington’s $780,000 estate was equivalent in value to almost one-fifth of 1 percent—0.19 percent—of the $411 million GDP. If Washington had lived two centuries later, and boasted a fortune worth 0.19 per cent of the nation’s approximately $15 trillion 2011 GDP, he would have been worth $25.9 billion, taking fourth place in the Forbes list of seriously wealthy Americans. Bill Gates is in first place at $59 billion, Warren Buffett in second at $39 billion, and Larry Ellison of Oracle fame gets the bronze medal with a $36 billion stash. Washington’s $25.9 billion sneaks him in just ahead of Christy Walton of the Wal-Mart chain. The first president is in rich company.
So how did he get there? What led Washington on the path to wealth? “It is no secret that Washington was not born to the imperial purple,” biographer John Richard Alden wrote. “Nor was he by birth a member of the First Families of Virginia, the fabled Virginia aristocracy. He opened his eyes without fanfare of trumpets, with modest hereditary prestige.” What young Washington lacked in inherited wealth, position, or aristocratic polish, he made up for in family connections that set him on the road to fame and fortune.
His elder half-brother, Lawrence, an army officer fourteen years George’s senior and more a father figure than a brother, married into the Fairfax clan—one of Virginia’s leading families. Always a mover and shaker, and a canny social climber, Lawrence Washington understood that the path to influence and riches lay in cultivating connections with Virginia’s colonial elite.
George Washington joined the Masonic Lodge in Fredericksburg in 1752—in those days a way to meet the right folk. By 1759 he married Martha Custis, in a well-engineered, top-drawer financial coup. The widow of a well-heeled gentleman planter, she was one of the wealthiest women in Virginia. She brought to the marriage prime Virginia acres whose worth today would measure in the millions of dollars. This bounty passed into her new husband’s care, and Washington passed from being a comfortably well-off country gentleman-soldier to become one of Virginia’s wealthy landowners.
Election to Virginia’s House of Burgesses was a natural progression, first from Frederick County and later as representative for Fairfax County. The burgesses met in Williamsburg, Virginia’s capital. Now Washington was at the center of Virginia’s elite.
There had been a time, however, when, at age fifteen, his sights had wandered from the hills and dales of rural Virginia. A midshipman’s commission in Britain’s Royal Navy was on offer, perhaps again facilitated by his half-brother. But at the eleventh hour his mother defaulted on letting her son pursue a life on the briny. Her brother said that “he had better be put a prentice to a tinker, for a common sailor before the mast has by no means the common liberty of the subject.” Washington’s uncle, Joseph Ball, suggested his nephew would be better off as a landowner than a ship’s captain. Above all he advised, “He must not be too hasty to be rich, but go on gently and with patience, as things will naturally go. This method, without aiming at being a fine gentleman before his time, will carry a man more comfortably and surely through the world than going to sea.”
Along with his ability to forge connections, Washington’s choice of career propelled him to financial greatness. Becoming a surveyor was almost certainly a result of Lawrence Washington’s guidance. Their father died when George was eleven, and in contrast to his elder brothers, who had been sent to school in England, the boy had to make do with a rudimentary schooling, perhaps with private tutors, that covered little more than the three Rs.
The boy had an aptitude for matters mathematical and an interest in geography: a perfect combination for a strapping, young, would-be surveyor. One biographer points out such scribbled notebook puzzles the schoolboy tackled as “How to measure any piece of Ground be it never so Irregular and to Cast up the Content in Acres, Roodes and Perches” and “How to take an Inaccessible distance at two Stations.” It suggests Washington had a natural liking for working with compass, chain, and brain since “the examples are too many, too varied, and too carefully inscribed to have been done entirely as tasks.”
In an unsettled continent, land surveyors were in demand. For Washington, a nod and a wink removed from Lord Fairfax, one of the richest and most influential men of the colony, employment was never an issue. His Lordship was blessed with an inherited land grant of five million Virginia acres between the Rappahannock and Potomac Rivers. To prepare it for tenants arriving from across the Atlantic required surveying.
At sixteen, Washington, chain, compass, pen, and notebook at the ready, was soon on the payroll. A year later his connections helped him win appointment as a part-time government surveyor for Culpeper County at £50 sterling per annum. Four years of survey work later, Washington had tallied land surveys for more than 200 clients. The job paid well: good frontier surveyors could earn as much as the ablest trial lawyers. What’s more, with the inside scoop on land deals, surveyors were often in a position to make advantageous purchases of their own. But more important than the business and good name he was making for himself was the realization that the immensity of the frontier was there for the taking. He knew good land when he saw it, and his work gave him a down-to-earth insight into the mechanics, and the politics, useful to securing title to unsettled acres. There would always be hindrances like Indians or Scotch Irish squatters to overcome, as well as the need to influence the government, but with his connections Washington, still in his twenties, was on his gentle way to financial success.
Yet there were setbacks. The expression “land rich, cash poor” applied to Washington at times in his mid-life career as tobacco farmer. Although his long-term goal of accumulating acres paid off after his death, there were periods when debts mounted and his financial outlook lost its rosy glow. As Washington prepared for his inauguration in New York City in 1789, he borrowed £100 at 6 percent interest from a friend to make the trip. The Mount Vernon agricultural enterprise was often mired in cash-flow problems.
The difficulty stemmed from Washington’s pretentions to “keeping up with the Joneses” or, in his case, the Fairfaxes, Carters, and Robinsons of Virginia. He lived beyond his means, and he pushed the limits. Buying outlandish, expensive fripperies from London merchant Robert Cary led Washington into debt. Cary purchased Washington’s Mount Vernon tobacco crop and in return shipped exotic English goods, along with agricultural accessories like plows and grass seed to Virginia. On Washington’s want list was a chariot “made in the newest taste, handsome, genteel and light . . . on the harness let my crest be engraved,” along with ivory-handled sets, and a seven and a half foot tester bed with blue and white curtains to match the wallpaper. Busts of historical worthies, Alexander the Great, Julius Caesar, and the King of Prussia, were to ornament the mantelpiece.
The value of Washington’s tobacco crop, however, was falling, and the luxuries were getting more expensive. He ended up owing Cary £800 on the account, and the interest, at 5 percent, mounted.
In 1766 Washington decided to opt out of tobacco production—the crop that was hard on the land and increasingly unprofitable—and diversify his production to wheat, corn, flax, and hemp, which were in local demand. He later pioneered a profitable distillery on the estate. It was, however, only when his stepdaughter, Patsy Custis, died in 1773 and Washington received money from her estate that he was able to settle his debt with Cary. Washington would not be the first, nor the last, Virginia landowner to discover that farming was not the easiest route to riches. Perhaps it explains why he was fond of saying, “Worry is the interest paid by those who borrow trouble.”
Andrew Gardner, who writes on Canada’s Salt Spring Island, contributed to the summer 2012 journal the article “Dodging the Check,” a story about debts and war.
Suggestions for further reading:
- John R. Alden, George Washington: A Biography (Baton Rouge, 1984).
- Charles H. Ambler, Washington and the West (London, 1936).
- Kenneth P. Bailey, The Ohio Company of Virginia and the Westward Movement (Glendale, CA, 1939).
- Robert E. Dalzell Jr. and Lee Baldwin Dalzell, George Washington’s Mount Vernon (Oxford, 1998).
- Eugene Prussing, The Estate of George Washington, Deceased (Boston, 1927).