A Profile of J.J. Hagerman

J.J. Hagerman has been largely ignored as a hero of Cripple Creek. Already a highly successful businessman in Wisconsin, Hagerman and family arrived in Colorado Springs in 1884. Like so many others seeking a cure, Hagerman came to Colorado looking to blunt the effects of tuberculosis.

Finding Colorado Springs to be a dying and underdeveloped town, Hagerman began looking for ways to improve it. He built the Hagerman Building and became a major stockholder in the First National Bank. However, the project to which he devoted the bulk of his time and energy was the construction of the Colorado Midland Railway from Colorado Springs to the booming silver town of Leadville.

Fighting many long battles, Hagerman raised the capital for the road and saw to its survey, construction and later operation. Like many of the more shrewd rail men of the day, he also acquired lucrative coal properties not only to provide coal to run the railroad, but also to sell coke to the Leadville smelters. The Midland made money by hauling coke and freight into Leadville and hauling silver ore on the return trip.

While running the Colorado Midland and negotiating its 1890 sale to the Santa Fe, Hagerman had also been busy investing in Aspen mining properties. The crown jewel of his Aspen investments turned out to be the Mollie Gibson Mine. Though the most influential stockholders knew the mine contained a bonanza, they sought to keep this a secret as long as possible. In the interim, adjoining key properties were purchased. Hagerman also kept the secret long enough for himself and close associates to gain majority control of the Mollie.

In its first big year, the Mollie Gibson produced more than $1.5 million in silver, paying off all the outstanding debt, leaving money in the bank and returning $1 million in dividends to its stockholders. At the height of the silver boom, Hagerman's holdings were worth an estimated $3-4 million, quite a grand fortune to that time.

Fortunately, while investing in Aspen, Hagerman's attention turned to the new gold boom over at Cripple Creek. His friends Count James Pourtales and Tom Parrish presented him with an opportunity. They had paid $80,000 for the Buena Vista claim. It was a sure producer, but they lacked the capital to develop it.

Copying the successful strategy he used with the Mollie Gibson, Hagerman not only injected some much needed development capital, but also purchased adjoining properties. The 22 claims he purchased were consolidated into the Isabella Gold Mining Company. When Colorado society learned of Hagerman's involvement in the Buena Vista and Isabella, the stock price shot from 25 cents to $7.50 per share.

The Isabella became one of the focal points for the 1894 Labor War in Cripple. The Panic of 1894 left the U.S. economy in tatters. Mine owners felt they needed to reduce expenses to stay competitive. When the Isabella and other mines attempted to change the workday from eight to nine hours labor for $3.00, all hell broke loose. The Western Federation of Miners took control of several properties around the District. The militia was called in. Gold production came to a standstill.

As a trusted member of the business community, J.J. Hagerman was nominated to negotiate a settlement. A summit conference was held at Colorado College. Hagerman and a handful of others represented the mine owners. Labor was represented by Populist Governor Davis Waite. The negotiations drug on for several days. In the end, the mine owners agreed to retain the $3.00 for 8 hours system. In many respects, this was a victory for labor. The shrewd and wily Hagerman scored many technical points, however, and proved himself the better negotiator.

It was Hagerman's last and grandest project that brought about his demise. He had conceived a great plan to irrigate, farm and settle the Pecos Valley of New Mexico. The project got off to a terrific start and many improvements were completed. Mother Nature and the Panic of 1894 got the best of Hagerman, however. A dam break and lack of outside investment forced a ruinous end to the Pecos Valley project. Hagerman lost the bulk of his fortune in New Mexico.

J.J. Hagerman died while vacationing in Milan, Italy in 1909. His son Percy took over the remnants of his father's once great empire. In the end, little could be salvaged and Percy died near poverty himself.