ESTABLISHING THE RAIL NETWORK
The railroad network that facilitated and shaped the rapid development of the United States during the nineteenth century was itself shaped, and its construction greatly accelerated, by the actions of Congress. In 1850 there was no national network of railroads. There were fewer than 10,000 miles of track in the eastern United States, mostly connected to large cities but not forming a unified system. For example, the farthest west one could continuously travel by train from New York City was Buffalo. Other than along the East Coast, there were no major north-south links. Yet by 1860, national rail mileage had tripled, and most of the major cities east of the Mississippi were tied together in a network so that people or goods could travel between any two major cities entirely by rail.
A major factor in this expansion was federal land grants to railroad companies. The grants provided the right-of-way plus large amounts of land adjoining the right-of-way that the company could sell or use as collateral against which to issue bonds to pay for construction. The first such grant, totaling 3,736,000 acres (5,837 square miles), was to build a continuous link from Chicago to Mobile, Alabama. By 1860 Congress had granted a total of 18 million acres for railroad construction.3 That area, about 28,000 square miles, is approximately the area of Vermont, New Hampshire, and Massachusetts combined.
With the rail system of the east relatively complete, the next obvious task was to span the continent with railroads. The First Pacific Railway Act of 1862 provided both the authorization and the financial incentives for a transcontinental railway.4 The act authorized the Union Pacific Railroad to build westward from St. Joseph, Missouri, and the Central Pacific Railroad to build eastward from Sacramento, California. The act granted the railroads a 400-foot right-of-way and five square miles of land for each mile of track built (a figure that was doubled by Congress two years later). In addition, the federal government issued bonds to provide construction funds. Thus investors in the project bore relatively little of the total risk. The building of the lines was accompanied by considerable corruption and malfeasance.
Their bookkeeping was, to say the least, primitive, and such records as existed
were destroyed, possibly by design, in a fire in 1873. But there can be little
doubt that the profits were enormous.5
Construction proceeded rapidly over formidable obstacles, and the two lines met at Promontory Point near Ogden, Utah in 1869, making coast- to-coast rail travel possible.
Within a decade or so, other lines crossed the continent, both north and south of the Union Pacific route. Here, too, congressional aid played a major role. In 1863 Congress granted the Atchison, Topeka, and Santa Fe 10 square miles of land for every mile of route constructed, and in 1864 the Northern Pacific railroad was given lands that totaled more than the entire area of New England.6
Grants of public lands to railroads continued until 1873, by which time approximately 160 million acres (250,000 square miles) of land had been given to railroads either directly by the federal government or indirectly by the federal government through the states.7 It is hard to imagine a more powerful stimulus to railroad building. The grants provided a clear and an uncontested title to the route, and the potential sale of land to settlers and speculators made the financial prospects very attractive. U.S. rail mileage grew from about 30,000 miles in 1860 to about 200,000 in 1900, by which time the rail network as we now know it was essentially complete.8