© Glen Brewer
In the United States, the phrase “first transcontinental railroad” has always been a confusing choice of words. In fact, what was meant was the completion of a continuous transcontinental network of railroads, not a single railroad from coast to coast. The single railroad concept is still just a dream in the USA, but not just a contemporary one.
Theodore Dehone Judah (March 4, 1826–November 2, 1863) may have been the single most important promoter of the Pacific Railroad Act. He established the difficult route for the Central Pacific east across the Sierras, obtained backers for the Central Pacific and lobbied congress relentlessly for legislative help. Unfortunately, he never lived to see his work to completion. He was badly treated by the Big Four, and while trying to improve his situation, on a trip from California to New York, he contracted yellow fever crossing Panama and died. Public domain photo from Wikipedia
Even though the nation’s railway system had already been rapidly expanding westward, the idea of involving the government to rush the completion of a continuous railways system was not a new one by the time of the Civil War. It was believed, probably correctly, that only with significant government help would private enterprise undertake such a massive undertaking anytime soon. It was an enterprise that would earn virtually nothing until it was completed, and even then, the size of the market was uncertain.
Explorations of possible routes for a railroad were done as early as the 1840s even though California (which included what are now several surrounding states) did not become a part of the United States until 1848 – the year gold was discovered by James W. Marshall at Sutter’s Mill. In 1853, a formal Army survey began to determine the most practical route for a railroad. Expeditions were conducted at various parallels, resulting in twelve volumes of “Reports of explorations and surveys, to ascertain the most practicable and economical route for a railroad from the Mississippi River to the Pacific Ocean”.
On July 1, 1862, in the midst of the Civil War, Abraham Lincoln signed the first Pacific Railroad Act. The official title was “An Act to aid in the construction of a railroad and telegraph line from the Missouri river to the Pacific Ocean, and to secure to the government the use of the same for postal, military, and other purposes.”
No governmental decision between routes had been possible prior to the war – everyone wanted the route for their own territory. The internecine conflict freed the remaining Union congress to make a decision among routes.
A second Pacific Railroad Act was signed into law on July 2, 1864 establishing a gauge of four-feet eight and one-half inches for the Pacific extension. This too was opportune: the majority of the railways in the North were of Stephenson’s gauge, while wider gauges were common in the South. The war had made the advantages of avoiding a break in gauge quite obvious, and the transcontinental gauge choice soon became the de facto standard gauge throughout the country.
Despite the acts of Congress, little could be done until after the war was over. There was corporate organization, and in isolated California, some surveying and grading was begun.
From the West
From the East.
What was it the Engines said,
Pilots touching,–head to head
Facing on the single track,
Half a world behind each back?
This is what the Engines said,
Unreported and unread.
In a florid Western speech,
Said the Engine from the WEST:
‘I am from Sierra’s crest;
And if altitude’s a test,
Why, I reckon, it’s confessed
That I’ve done my level best.’
‘They who work best talk the least.
S’pose you whistle down your brakes;
What you’ve done is no great shakes,
Pretty fair,–but let our meeting
Be a different kind of greeting.
Let these folks with champagne stuffing,
Not their Engines, do the PUFFING.’
Shores of snow and summer heats;
Where the Indian autumn skies
Paint the woods with wampum dyes,–
I have chased the flying sun,
Seeing all he looked upon,
Blessing all that he has blessed,
Nursing in my iron breast
All his vivifying heat,
All his clouds about my crest;
And before my flying feet
Every shadow must retreat.’
And a long, low whistle blew.
‘Come, now, really that’s the oddest
Talk for one so very modest.
You brag of your East! YOU do?
Why, I bring the East to YOU!
All the Orient, all Cathay,
Find through me the shortest way;
And the sun you follow here
Rises in my hemisphere.
Really,–if one must be rude,–
Length, my friend, ain’t longitude.’
I’ll run over some Director.’
Said the Central: ‘I’m Pacific;
But, when riled, I’m quite terrific.
Yet to-day we shall not quarrel,
Just to show these folks this moral,
How two Engines–in their vision–
Once have met without collision.’
Unreported and unread;
Spoken slightly through the nose,
With a whistle at the close.
Corruption and scandal.
The government aided the companies in their financing in two ways: by providing U.S. government bonds, due in 30 years and paying 6% interest, and by grants of land for the railroads’ direct needs plus alternate sections (one section is one square mile) of government-owned land (where available) along the tracks for 10 miles on either side — 6,400 acres per mile. Potentially the land might provide resources such as timber, ballast, coal etc. The primary concept however, was that both the railroad and the government would sell to developers, the government would get a good price and the railroads would use their proceeds to fund continued building. Settlement was expected to follow construction, and new transportation customers would be created. However, much of the land was of little use and never sold especially when the money was needed most.
Bonds were issued at $16,000/mile for track laid at level grade, $32,000/mile for track laid in foothills and $48,000/mile for track laid in mountains.
No grants were available until after the completion and acceptance of stated mileages. Raising the initial capital to finance construction was difficult in the war torn nation.
Not everyone at the time thought the act was wise. I haven’t been able to verify the quote, but Cornelius Vanderbilt commented (as best as I recall), “Building a railroad from nowhere to nowhere at government expense is no enterprise at all!” Instead of building gradually, surviving what little population centers already existed (Denver and Salt Lake City), the railways went more or less directly through mostly unsettled landscape.
Predictably, there was scheming and chicanery from the very start. Many in congress were persuaded with stock to improve the government terms. The UP seemed to take unnecessarily wondering routes, while the CP convinced the government that the mountains started closer to Sacramento than previously thought.
Management of the two companies did not expect to profit much if at all from the running their railroads – the real profit potential, it seemed clear, was from construction. Both management groups formed separately incorporated construction companies. Costs of construction were extraordinarily high.
The UP construction company had the imaginative name of Crédit Mobilier of America. In 1872 (the joining of the rails was in 1869) it became the subject of a major scandal involving many members of congress, UP management and others. Many prominent men were implicated including Schuyler Colfax (Grant’s vice president), Congressman Oaks Ames (UP’s greatest supporter in congress) and future president James A. Garfield. Crocker’s company saw it coming, closed out the business and destroyed the records.
The question remains: was this wise legislation?
It is true that the railroads were built in record time — Union Pacific did not start actual construction until July 1865. But the quality of construction (especially of the UP) was poor and the cost was much too high. Years later, much new capital and a complete rebuilding under the control of E. H. Harriman were required to make a successful railroad operation. Neither company made much money from early operations, and neither could repay the huge debt in government bonds when they came due. Government required concessions on military and mail transportation did much to reduce any chance of profitability. Most of the land in the grants could not be sold in time to finance construction, much never was sold.
The Union Pacific/Central Pacific combination was the first but certainly not the last of the so called transcontinental railroads across the US west. By comparison, the Great Northern was built independently by James J. Hill. Hill took his time, developed business along the line, studiously surveyed the route and did not reach Seattle until 1893, but all this was done without government largesse, interference or corruption. The Great Northern was well thought out, well built and made money from the start.
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