The Last Empire
A rootless steamboat captain carved the King Ranch out of the frontier more than a century ago. Today Captain King’s descendants, rooted in the land he conquered, struggle to hold his legacy together.
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He also left his mark on every aspect of the original ranch. He led it through the tumultuous decade following the death of Henrietta King in 1925. He survived bitter court battles with his cousins over the division of the ranch. He weathered the Depression and its catastrophic effect on ranch profits. He engineered a deal with Humble Oil for the ranch’s oil and gas rights that put it permanently on a sound financial footing. And he developed an entirely new breed of cattle that was to the cattle business what the Model A Ford was to the car business. He was, by any definition, a genius.
Like his brother and sisters, Bob Kleberg grew up on the ranch. He learned to ride at four, and to cut, rope, and shoot soon after. His mentors were his cousin Caesar Kleberg, ranch foreman Sam Ragland, and the Kineños. Caesar was the family eccentric. He ran the southern sector of the ranch from a weathered old ranch house at Norias that had neither electricity nor plumbing. The railroad tracks cut through the front yard. The bathtub was on the front porch, and cots did for beds. The place was so cluttered it was rumored that nothing that went in ever came out, except, occasionally, Caesar himself.
As a boy Bob lived with Sam Ragland in the foreman’s cottage next to the Big House. Ragland and Caesar, as well as Kineños like Augustín Quintanilla and Faustino Villa, who had been with Captain King on the river, made the younger Kleberg son their apprentice. He was a quick learner. With their help he trained his eyes, his ears, and his nose to pick up the subtle variations that told him, as if by instinct, which calves would breed best, which clouds carried rain, which plant stung and which one healed. Bob’s early ambition was to be an inventor, and later the stirrings of youthful independence caused him to announce that he was going to be an engineer. But the onset of his father’s palsy and World War I changed that. He came home to run the ranch in 1918 after only two years of college, and for all practical purposes he did not leave it for twenty years.
The Ranch Divided
In 1925, at the age of 92, the widow of the King Ranch died. At Henrietta King’s bier were bankers from the East, railroad executives, oilmen, politicians. There were also hundreds of Kineños, some of whom had ridden for two days from the ranch’s far divisions. Unbidden, they led the funeral procession into the town cemetery, a few miles from where her husband had first brought her to the uninhabited frontier more than seventy years before. Then they circled the open grave on horseback at a fast canter, their hats held at their sides.
Mrs. King’s death threw the ranch into crisis. The estate taxes, and the depression that soon followed, dragged the ranch more than $3 million into debt, to the edge of financial ruin. And more ominously, the huge empire built by the riverboat captain had to be divided among his heirs for the first time. That complex and, in some cases, bitter process consumed an entire decade. It was Bob Kleberg’s first great test.
Mrs. King’s will called for her daughter Alice to receive the northern tier of the ranch, the Santa Gertrudis and Laureles divisions. The southern sector was divided among her other heirs, with the children of Richard King, Jr., receiving the Santa Fe Ranch to the west. The Atwoods, heirs of Mrs. King’s eldest daughter, Nettie (from whom she had long been estranged, never having approved of her marriage to an Army officer), received El Sauz on the south. The Klebergs got the northeastern portion known as the Norias Division, to which they added the shares of two other heirs who sold out to them. In the early twenties, knowing his family was going to lose most of the sandy pasture in the southern sector. Bob Kleberg had bought a sandy ranch south of Falfurrias, to create another division, the Encino, just north of the Santa Fe Ranch. Of the ranch’s 1.2 million acres, the Klebergs ended up with more than 800,000.
Throughout the ten years between Mrs. King’s death in 1925 and the final partition in 1935 Bob Kleberg, the youngest trustee, ran the ranch for the heirs. He ran it without hesitation and with a zeal that angered the Atwoods. They fought the will bitterly, challenged his trusteeship, raged over his imperial manner, and fumed that he charged his freewheeling escapades to the estate. Led on by their Chicago lawyer, the Atwoods refused to take El Sauz and sued the ranch for nearly twenty years, all the while living in comparative poverty on a modest allowance Mrs. King had given them in her will. Estranged, lonely, and resentful, one of them bequeathed her estate to a Chicago policeman who had treated her kindly. The lawyer ended up with well over half of El Sauz in return for masterminding what was, by the time it was finally settled in the fifties, the longest suit in Texas history.
To manage their holdings, in 1934 the Klebergs incorporated the King Ranch (which meant that the descendants of Richard King, Jr., would no longer be a part of the ranch that bore their name). Each of the five children of Alice King and Robert Kleberg, Sr., got one fifth of the stock, which they pooled in a trust set up to last until 1954, when they or their heirs would control the stock individually. The intent was clear: after suffering through the tense decade following Mrs. King’s death, Bob Kleberg, his brother, Richard, and their three sisters were pledging to keep the King Ranch together.
The incorporation of the ranch was the beginning of its modern history. It was no longer one man’s empire. Now it belonged to a growing family whose members would have to agree on its destiny. In 1934 there were only five stockholders; in two generations there would be more than sixty. Corporate politics, meaning family politics, would decide the ranch’s future, even if the will, charisma, and above al, the longevity of Bob Kleberg would obscure that fact for four decades. Back in the early thirties, however, Bob worried less about how his heirs would run the ranch than about making sure they would have something to run. Neither the Atwoods, the land, nor the future was the biggest thorn in his side — money was.
Playing The Oil Card
Ranchers have traditionally been landpoor: long on acres, short on cash. Ever since the brief halcyon years of the cattle boom following the Civil War, the King Ranch had seldom earned more than $100,000 or 5200,000 a year in profit from all its ranching operations. Some years it lost money. In the thirties, however, drouth so parched the ranch’s pastures that its cattle were starving. Yet there was no point in buying feed for them — fat steers were selling for a pitiful three and a half cents a pound. The King Ranch unloaded thousands of head and earned in return barely enough to pay for shipping them to market.
It was a grim period. Bob’s cousin Richard King (who was still with the ranch then) spent all his time on trains, trying to stay ahead of the ranch’s creditors by floating new loans to pay off the old ones coming due. Throughout the crisis the elder Kleberg, the old German lawyer who had bested a riverboat captain in court, still got in his car every afternoon and had himself driven around the ranch, his blue eyes staring out at the barren plains, his once fertile mind now made helpless by a stroke.
The pressure on Bob to sell off big chunks of the ranch, to throw into the fire the only asset it had left — its land — became overwhelming. No one saw any other way out. But Bob, obstinately and unreasonably, refused to sell land. “Selling is easy,” he would say. “Collecting is hard.” He looked instead to something else the ranch possessed-beneath its surface. He looked to oil.
In 1933 Bob Kleberg tried to persuade several oil companies to take a lease on the ranch. Gulf, Shell, and Texaco turned him down. Humble Oil did not: in return for a loan that would assume all of the ranch’s $3 million debt, then held by numerous investors in the form of King Ranch notes, and in return for a royalty interest and enough bonus payments to meet the interest on the loan, Bob granted Humble the right to search for oil and gas on the more than one million acres the family controlled before the partition. When the deal was closed, Humble had possession of what was then the largest oil and gas lease in the world. And the ranch — provided, as many oilmen doubted, that there was oil under its pastures — was on a sound financial footing at last.
Using the primitive geological survey methods of the time. Humble spent the next six years trying to discover just where to drill its first well. “It was like firing a rocket into space not knowing where the planets were and expecting to hit something,” a veteran of the early exploration recalled. In 1939 Humble began drilling in the sections adjacent to proven fields outside the ranch. It was not until 1945, twelve years after the lease was signed, that they went after new fields with their first wildcat well. It hit. Two years later the ranch had raked in $3.25 million in royalties from fields that the Oil and Gas Journal estimated would be second to East Texas in oil and second to Amarillo in natural gas. By 1953 there were 650 producing wells on the ranch.
The relationship between the King Ranch and Humble was based on a simple understanding: the King Ranch might be an oil field to Humble, but it was still a ranch to Bob Kleberg. For example, when the first oil well was no longer a producer, it was converted to a water well and used to fill stock tanks. Oil has been a considerate guest. Pumps, rigs, gas lines, and equipment are kept up to the standard of appearance of the ranch, which, not so incidentally, got with its royalties a free system of roads and free natural gas.
The free gas eventually became something of a headache for Humble. On one memorable occasion, the top executives of Standard Oil, Humble, and other oil companies were house guests of Henrietta Larkin Armstrong, Bob’s sister. Henrietta was an enthusiastic gardener. That night a blue norther sent the temperature in South Texas into the twenties, so Henrietta set out dozens of gas stoves to keep her plants from freezing. Sometime after midnight the stoves stopped working. With undeniable logic, she rousted all the oil company presidents and board chairmen out of their beds with the command “You all know everything about gas — get up and fix my stoves!” They did, and not long after that gave up supplying the ranch with free gas from their wells and installed propane tanks instead.
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