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The Ordinance of 1785, passed by the Continental Congress under the Articles of Confederation, laid out the basic pattern of landownership in what was then the Northwest Territory, a tract extending from the western border of Pennsylvania westward to the Mississippi, bounded on the south by the Ohio River and on the north by the Great Lakes. The act established the six-mile-by-six-mile-square township and the one-square-mile section as the basic units for land division. In the original plan, land was to be auctioned off in blocks of one square mile (640 acres) at a minimum price of $1 per acre. The money was to provide Congress with revenue, and the process of auctioning land in relatively small pieces would people this vast area with small, independent farmers. When the $1-per-acre price proved to be too high, Congress backed away from the plan to some extent by selling off large blocks of land to investors and speculators at a much lower price. The area then developed in a manner largely determined by the rate at which these buyers could create new settlements and resell land to individual holders. The effect of the act was to permit the rapid peopling of the area and to lay down a basic grid pattern that is still readily seen on a map of Ohio, Indiana and other parts of the upper Midwest. The decision to sell farm-sized plots of land to individuals reinforced the rural American pattern of scattered farmsteads as opposed to a pattern commonly seen in Europe in which a rural population lives in hamlets or villages surrounded by the fields farmed by its residents.

In the latter half of the nineteenth century, the settlement of the west was very much influenced by a few other decisions of the federal government. The Homestead Act of 1862 permitted settlers to claim 160-acre blocks of public land at essentially no cost if they would reside on the land for five continuous years.2 Ultimately, about 80 million acres, roughly 125,000 square miles, were homesteaded. Most homesteading occurred west of the Mississippi and much of it in areas that did not have adequate and predictable rainfall to support agriculture. This situation, some decades later, helped propel the federal government into taking a major role in water development throughout the west.

In the same year, Congress passed the Morrill Land Grant Act, which granted each state 30,000 acres of federally owned land for each member of the state's congressional delegation. The states were to use the monies from the sale of these lands to establish at least one college that would have as its primary role the teaching of "agriculture and the mechanic arts." A great many of the state universities in the United States today are land- grant colleges. The suffix A&M in a university's name dates from the act. In the case of many other schools, the "A&M" has subsequently been lost. Again, the federal government's actions were all carrot and no stick. No state was required to create an A&M college nor told where such a college should be located. The states were simply offered an attractive option, and most of them made use of it. The scattering of major state universities in small towns across the United States is, in part, a legacy of the Morrill Act.

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