Richard King Mellon

views updated

Richard King Mellon

Financier and banker Richard K. Mellon (1899-1970) was one of the richest men in the United States in the 1960s. He was the last great leader of the Pittsburgh-based Mellon financial dynasty. Mellon used his status and wealth to help lead the city's famed renaissance.

Richard King Mellon was born on June 19, 1899 in Pittsburgh, Pennsylvania, into one of America's great financial families. His grandfather, Thomas Mellon, established the private bank of T. Mellon and Sons in 1869 after his retirement from a long career as a lawyer and judge. The Pittsburgh bank prospered and served as the foundation for the family's vast holdings throughout the nation.

One of Thomas's sons, Andrew W. Mellon, later Secretary of the Treasury under Presidents Harding, Coolidge, and Hoover, took over the bank in 1880 when his father died. Another brother, Richard Beatty Mellon, acquired 50 percent of the bank in 1889 and later became president of the newly renamed Mellon National Bank. Richard Beatty Mellon married Jennie Taylor King and she gave birth to Richard King Mellon at the end of the nineteenth century.

The young Mellon had to develop his financial mettle early. By the age of 12, he was raising and selling squab pigeons. At 17, his father placed $5,000 in his checking account in order to test his son. Legend has it that Mellon never touched the money in case his father one day asked for it back.

Mellon had an outstanding relationship with his father, and this shaped much of his personality and interests. The Mellons had a family retreat in Ligonier, Pennsylvania, where they could hunt, fish, and ride horses. Father and son both loved the outdoors. The son was of average height, but had a rugged, athletic build, which he maintained throughout his lifetime.

Tutored at home until the age of 12, Mellon entered Shady Side Academy in Pittsburgh, a private high school, then transferred to Culver Military Academy in Indiana. After graduation, he went on to Princeton University, but dropped out after one semester to join the army. He served as a private and student pilot in the Army Air Corps during World War I. Although he did not see military action—the Great War ended while he was in officers training school in Virginia—Mellon began a lifelong fascination with the armed services.

Mellon and his father spent the decade beginning in 1917 building Rolling Rock Farms and Country Club. What began as a simple log cabin developed into an 18,000-acre spread where the Mellon family could find solitude. Richard Beatty Mellon loved to entertain, so he had constructed a little club where he could be with family and friends. In time, the club became more elaborate and stables, a golf course, pool, and skiing facilities were added. Membership in the club was a token of esteem for Richard Beatty Mellon's friends. His son called the place a "horseman's paradise" and imported English foxhounds in 1921. Over the course of his life, Mellon would return to the club as often as possible. He never gave up his love of the outdoors.

Inherited Family Business

After World War I, Mellon returned to Princeton, but left the university soon thereafter. Instead of a formal education, he received tutors in subjects that would benefit him. By no means an intellectual or rebellious in the least, Mellon set out to learn banking and finance from his father. Mellon later told Forbes magazine, "It was taken for granted that I would follow him in the bank."

Like many sons who are expected to one day take over the family business, Mellon began learning the business from the bottom in 1920 as a messenger and assistant cashier. Unlike most messengers, however, Mellon was also named treasurer of a small railroad controlled by the family. In 1928, he became a vice president. Since none of Mellon's cousins were interested in a career in banking, he was the only logical successor when his father died in December 1933. Richard King Mellon became president of Mellon National Bank the next year.

Assuming the presidency of the bank was only part of Mellon's larger responsibilities. After the death of his Uncle Andrew in 1937, he became the de-facto leader of the Mellon dynasty. Mellon felt a strong sense of duty to carry on the family business. His cousin, Paul Mellon, was elected to concentrate on philanthropic endeavors.

Mellon presided over the bank and also held director-ships in numerous corporations around the United States. In those days, a directorship carried a great deal of influence and was a sign of utmost respect. By 1937, Mellon held 34 directorships. He had a hand in nearly every business activity in the Pittsburgh region and also served on the boards of General Motors, Gulf Oil, and other Fortune 500 corporations.

Mellon returned to active military duty in 1942 as a major in the army. His first assignment was to direct the selective service system for Pennsylvania. He was promoted several times and then served as assistant chief of the War Department's international division in Washington, DC. Mellon established banks in the armed forces and promoted the show "This is the Army." For his outstanding service during World War II, the War Department awarded him the Distinguished Service Medal.

Discharged as a colonel at the end of the war, Mellon remained in the Army Reserves for another 16 years. He continued advancing through the ranks and, when he retired in 1961, he had achieved the position of lieutenant general. Throughout his life, Mellon was commonly known as "King," but in the 1960s he was also called "General." He made generous contributions to Valley Forge Military Academy and wore his general's uniform whenever possible.

Consolidated the Mellon Empire

After the war, Mellon began two interrelated projects. He committed himself to revitalizing Pittsburgh, which was little more than a rundown steel town. Concurrently, he solidified the family's business interests which, in great part, were linked to the fortune of the city. An aide, Wallace Richards, outlined a plan for bringing the city back to life. It relied on the support of both civic and corporate leaders.

Pittsburgh's deterioration and sluggish growth threatened the economic well-being of the region. Many corporations were considering relocating to cities where they could attract young business leaders and offer them a better quality of life. In 1943, after hearing Richards' plan for a "renaissance," Mellon helped establish a group of city business leaders, known as the Allegheny Conference on Community Development.

A true visionary, Mellon supported the committee's work, even when it hurt his own short-term interests. He could always be counted on to make phone calls to keep the business community in line. More importantly, Mellon cooperated with Pittsburgh Mayor David L. Lawrence, although the two had little in common and were on the opposite ends of the political spectrum.

The joint work of the business and political community vastly improved the quality of life in Pittsburgh. The city established pollution controls and built a downtown that is still the envy of many large cities. This was the nation's first privately financed urban redevelopment project. With the first wave of the renaissance complete, Lawrence credited the outcome to "the Mellon economic power."

Pittsburgh's renaissance included tearing down almost 100 old buildings and replacing them with skyscrapers and modern office buildings. The city converted old railway yards into a park and built dams to provide flood control. Pittsburgh's rebirth was an inspiration for similar efforts across the country, most notably in Cleveland and Baltimore.

Turning his sights to the Mellon family fortune, he set up T. Mellon and Sons, an organization of family members to study their common interests in business and philanthropy. Mellon developed into one of the most important corporate leaders in the nation in the late 1940s. He was named one of Forbes magazine's "50 foremost business leaders" in 1947 and 1957.

In 1946, Mellon presided over the merger of his own company with its main competitor, Union Trust company of Pittsburgh. The newly-formed company had a market capitalization of over $157 million and was the 16th largest bank in the nation. In business circles, Mellon was regarded as "tough as nails," but he did not run the day-to-day operations of his companies. He had a large staff and key lieutenants who kept track of daily affairs.

In the early 1960s, various publications tried to estimate the worth of the Mellon family. Mellon, the steward of the family's wealth, had grown the fortune to an estimated $5 billion, while he himself was one of the ten richest men in America. Mellon's stock interests alone accounted for over $405 million.

Mellon had a wide variety of philanthropic interests. He served as a trustee of the Mellon Institute, the University of Pittsburgh, the Carnegie Institute of Technology (now Carnegie Mellon University), and the Carnegie Museum. In 1965, Mellon donated $5 million to Carnegie Tech to establish a computer science department. In fact, he donated millions to every college in the city of Pittsburgh. One of his more notable achievements was co-sponsoring (with the March of Dimes) the research that led Jonas Salk to the discovery of the vaccine that ended polio.

Later Years

Mellon married Constance Prosser in 1936. The couple adopted four children. Throughout his life, Mellon was shy and hated publicity. He surrounded himself with competent advisors and relied heavily on the good business sense of his closest associates. Since Mellon shunned public speaking and interviews, there are few documented glimpses into his personality or style.

Biographer David E. Koskoff contends that Mellon was a difficult husband and distant father. Koskoff described him as being rigid, humorless, and short-tempered. If this is true, then Mellon's children did not benefit from the close bond that he held with his own father. He did not get along with the other members of his extended family. They resented his control and position as family patriarch.

What is certain about Mellon is that he remained an outdoors enthusiast throughout his life. He hunted big game in the Canadian Rockies and Alaska. He even built a stone mansion in Ligonier, called Huntland Downs, and commuted the 50 miles each way to Pittsburgh daily. Mellon's main recreational interests centered on hunting, fishing, riding, and breeding racehorses.

In the later years of his life, Mellon suffered a heart attack and his capacities quickly declined. In 1967, he became the "honorary" chairman of Mellon Bank. He died of heart problems in Pittsburgh on June 3, 1970, just shy of his 71st birthday. His death ultimately ended the Mellon dynasty.