THE IRON COLT BECOMES an IRON HORSEThe govt.- business relationship that formed during the Civil War sparked the unparalleled industrialdevelopment following the war. The outburst of railroad construction was a crucial case. In1865, there were 35,000 miles of rail; in 1900, the figure had spurted to 192,556 miles of rail.
The proposed transcontinental rail lines would be would be costly and risky. Explain whythe construction of these rail lines would require federal subsidies.
Through the federal land grants, Big Business was willing to build the rail lines and thegovt. received long-term preferential rates for postal service and military traffic.Frontier villages along rail lines became flourishing cities – communities battled oneanother for the privilege of hosting a rail line.
SPANNING the CONTINENT with RAILSDeadlock in the 1850’s over the proposed transcontinental railroad was broken when theSouth seceded, leaving the field to the North.In 1862, Congress made provision for starting the long-awaited line that would bind thePacific coast with the remainder of the Republic – the desperate war effort created asense of urgency.
The Union Pacific Railroad was commissioned by Congress tothrust westward from Omaha Nebraska – constructionbegan in 1865.For each mile of track constructed, the company wasgranted 20 sq. miles of land, alternating in 640-acresections on either side of the track.And for each mile the builders received a generous federalloan, the amount determined by the topography.Because of these govt. incentives, promoters made all haste.Insiders of the Credit Mobilier construction companyreaped fabulous profits – they slyly pocketed $73 million for$50 million worth of work. Company officials bribedcongressmen to look the other way.Sweaty construction gangs, containing many Irish “Paddies”(Patricks) who had fought in the Union armies worked at afrantic pace. The work was especially dangerous, includingIndian attacks and construction accidents.
Rail laying at the California end to connectwith the Union Pacific was undertaken by theCentral Pacific Railroad.Four farseeing men, the so-called “Big Four,”led by Leland Stanford, were the financialbackers.Some 10,000 Chinese laborers, sweating fromdawn to dusk, proved to be cheap, efficientand expendable.The “Big Four” walked away with millions, buttheir profit was largely legitimately earned(no bribery).
BINDING the COUNTRY with RAILROAD TIESFour other transcontinental lines were completed before century’s end. None of themsecured monetary loans from the federal govt., as did the Union Pacific and the CentralPacific. But all of them except the Great Northern received generous grants of land.
Yet the romance of rails was not without its sordid side. Pioneer builders were oftenguilty of gross over-optimism. They sometimes laid down rails that led “from nowhere tonothing.” When prosperity failed, they went into bankruptcy, carrying down with theminvestor’s savings. The decades following the Civil War saw manybankruptcies, mergers, reorganizations, and the exploitation of farmers. James Weaver
RAILROAD CONSOLIDATION and MECHANIZATION The success of the western lines was facilitated by welding together and expanding the older eastern networks, notably the New York Central. The genius in this enterprise was “Commodore” Cornelius Vanderbilt. Making millions in steam boating, he daringly turned to a new career in railroading. Though ill educated, coarse, and ruthless, he was clear-visioned. He offered superior rail service at lower rates.
Two significantimprovements, including the steelrail and standard gauge, proved aboon to railroads.Other refinements played a vitalrole in railroading, including theWestinghouse air brake and thePullman Palace Cars.Despite these innovations, appallingaccidents continued to be regularoccurrences.
REVOLUTION by RAILWAYSThe railroads touched countless phases of American life: 1. A sprawling nation became united in a physical sense. 2. The railroad spurred the amazing industrialization of the post-Civil War years. 3. The railroads stimulated mining & agriculture, especially in the West. 4. Railways were a boon for cities and played a leading role in urbanization. 5. Railroad companies also stimulated the mighty stream of immigration 6. The land also felt the impact of the railroad, especially in the country’s mid-section. 7. Time itself was bent to the railroad’s needs. On Nov. 18, 1883, the major rail lines decreed that the continent would henceforth be divided into four “time zones.” 8. Finally, the railroad, more than any other single factor, was the maker of millionaires.
WRONGDOING in RAILROADING Corruption lurks when millions are at stake. The Credit Mobilier scandal was but the first of the first of the unsavory business practices employed by the railroad promoters. Jay Gould was the most adept of these rail promoters – he mastered the practice of stock watering – grossly inflating claims about a given line’s assets and profitability and sold stocks and bonds far in excess of the railroad’s actual value. Cornelius Vanderbilt and son, William Vanderbilt, lived by the credo, “Law! What do I care about the law? Hain’t I got the power?” Describe the practice of “pooling.” Other business practices included the interlocking directorate and the bribery of govt. officials.
GOVERNMENT BRIDLES the IRON HORSE It was neither healthy nor politically acceptable that so many people were at the mercy of the few rail barons. Explain why the American people and the U.S. govt. were so reluctant to reign-in the rail barons? What finally goaded farmers into action against the abuses? State efforts at regulation screeched to a halt in the Supreme Court’s Wabash case decision in 1886 – explain the decision.
President Cleveland was not supportive of federalregulation, but Congress passed the epochalInterstate Commerce Commission Act in 1887 –identify its provisions. What were the strengths& weaknesses of this legislation?In the end, what was the fundamental significanceof this landmark legislation?