John Steele Gordon shares with Barron’s readers an interesting history lesson. Before the 1824 U.S. Supreme Court ruling in Gibbons v. Ogden, New York granted a monopoly on steamboat navigation to Robert Fulton and the “politically well-connected and immensely rich” Robert Livingston.

“As with all monopolies,” Gordon writes, “the Fulton-Livingston enterprise was high-priced, lazy, and unpopular with the general population.” Thomas Gibbons of New Jersey decided to inject some competition into the picture, with the help of an “up-and-coming young boatman” named Cornelius Vanderbilt. Gibbons and Vanderbilt eluded the New York authorities until the Supreme Court threw out New York’s monopoly by ruling the state could not interfere with interstate commerce.

The effect in New York was immediate. Fares fell by an average of 40%, while the number of steamboats plying New York waters increased in two years from six to 43.

Gibbons died only two years later, but Vanderbilt would go on to become the greatest steamboat owner in the country, thanks to his joy in fiercely competing by means of better (and safer) boats and cheaper fares. The New York Times likened him to the robber barons of the Rhine for “blackmailing” the opposition into buying him out. But as Harper’s Weekly wrote in 1859, “Wherever he ‘laid on’ an opposition line, the fares were instantly reduced; and … never again raised to the old standard. This great boon — cheap travel — this community owes mainly to Cornelius Vanderbilt.”