Horse Racing: Hard Times at Calumet

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The Hutcheson Stakes at Florida's Gulfstream Park is a race for three-year-olds—a fact that qualifies it, technically, as a stepping stone for the Kentucky Derby. But the $10,900 winner's purse attracts few really promising horses. "If you enter a lot of little races, you're just spinning your wheels," says Calumet Farm's Trainer Jimmy Jones. "You can't run a racing stable on nickel-and-dime pots." And yet, there in the winner's circle, his pudgy face twisted into a gleeful grin, stood Jimmy Jones with Ky. Pioneer, which had just carried the devil's red and blue of Calumet to victory in the Hutcheson Stakes, of all races. The runner-up: Calumet's Kentucky Jug.

Trainer Jones, 57, needs all the nickels and dimes he can get these days. Calumet, which bred two Triple Crown winners, Whirlaway and Citation, won the Kentucky Derby seven times,* more than any other stable in history, and swept the money-winning championship twelve times in 21 years, has not even entered a horse in the Derby since 1958. At Santa Anita, Hialeah and Belmont, Calumet's proud champions were once hailed as "the New York Yankees of horse racing." No more.

In 1963 Calumet did not win a single stakes race; its horses, which in 1947 set the all-time record of $1,402,436 in winnings, earned only $168,543—a pittance compared with the $750,000 needed to break even. It was the fourth straight losing season, and it had better be Calumet's last. By U.S. Internal Revenue Service rules, a racing stable is taxed as a business unless it loses money for five straight years; at that point, it is automatically classed as a hobby, and the owner has to pay taxes on every penny of income for the full five years. Sighs Calumet's worried owner, Mrs. Gene Markey: "We have to make money this year. I may have to sell something to do it."

Horse Factory. She could always start with the silverware. The Pine Room at Calumet Farm, five miles outside Lexington, Ky., glitters from floor to ceiling with equine loot: the seven Kentucky Derby trophies, six Preakness cups, four Jockey Club Gold Cups, 76 Julep Cups representing feature race winners at Keeneland. Mrs. Markey could also auction off some land. Calumet's 846 acres of rolling Kentucky bluegrass are worth some $3,500,000—and that's not even counting the 18-room manor house, 36 outbuildings and 23 miles of white oak fences. The estate was inherited from his family by Mrs. Markey's first husband, Chicago Tycoon Warren Wright, in 1931, three years after he had sold his controlling interest in Calumet Baking Powder Co. for $29.2 million. He insisted, nonetheless, that the farm show a profit. Wright spent as much as $75,000 on a single brood mare, hired experts to chart thoroughbred blood lines, handpicked every employee from blacksmith to exercise boys. At his death in 1950, Calumet was a high-pressure horse factory, the most successful thoroughbred breeding operation in the U.S.