205 Completion of the Pacific Railroad (1869)

The present year witnesses the completion of the most important enterprise of the kind ever executed in any country —a line of railroad from the Missouri River across the Continent and with connecting lines from the Atlantic to Pacific Ocean, a distance of 3,250 miles. This great undertaking was commenced in the latter part of 1863 but no considerable amount of work was made till 1865, in which year only about 100 miles were constructed. In 1866 about 300 miles were opened. In 1867 about the same number. In 1868 about 800 miles and in the present year about 300; the whole distance from the Missouri to Sacramento being 1,800 miles. Toward the construction of these roads the Government has or will issue its 6 percent currency bonds to the amount of about $63,616,000, viz.: upon 300 miles at the rate of $48,000 per mile, upon 976 miles at the rate of $32,000 per mile and upon 1,124 miles at the rate of $16,000 per mile. The annual interest upon the above sum will equal $3,816,960. These bonds are a second mortgage upon the respective lines, the several Companies being authorized to issue their own bonds to an amount equal to the Government subsidy and to make them a first mortgage upon their roads.

The influence of these works upon the commerce and welfare of the country must be immense. A vast commerce, yet in its infancy, already exists between the two shores of the Continent. With the advantage and stimulus of the railroad this commerce must soon assume colossal proportions. Fronting the Pacific slope are hundreds of millions of people in Eastern Asia who are rapidly taking part in the commerce of the world and who will have the most intimate relations with our own Continent, which produces the gold and silver which at present forms one of the chief staples of commerce with them. It is hardly possible to estimate the magnitude of the commerce which will eventually exist between the Pacific coast and China and Japan. It is a commerce in which the world is to engage and in which the Pacific Railroad is to be one of the most important instruments.

This road too will open up to settlement vast tracts of hitherto inaccessible territory, either fertile in soil or rich in the more valuable minerals which are likely amply to compensate for the want of agricultural wealth. The main line will serve as the trunk from which lateral roads constructed by private enterprise will branch off in every direction. Already several important branches are in progress — one to Denver Colorado, one to Salt Lake City, and one to connect it with the Columbia River. These branches will open up wide sections and add largely to the traffic of the trunk line.

The construction of this and of similar works by the aid of the Federal Government has excited great interest and although at present public opinion seems to be against any further grants of money, there can be no doubt that Government has been largely the gainer by the aid it has extended to the Pacific Railroad and its branches. The public taxes equal, at the present time, ten dollars per head of our population. These works have been instrumental in adding more than 500,000 to our population whose contributions to the National treasury have far exceeded the interest on the bonds issued to them. They have certainly been instrumental in securing the construction of an equal extent of line which but for them would not have been built. Assuming the tonnage of these roads to equal 2,000 tons to the mile of road, the aggregate will be 9,800,000 tons having a value of $490,000,000. The gain to the Federal Government from the creation of such an immense tonnage and value far exceeds the sums it has paid in aid of their construction while the gain will in a very short time more than equal the principal sum of the bonds issued. Equally beneficent results will follow the construction of similar works. The people of the United States cannot afford to have extensive portions of their wide domain remain without means of access. In cases where such means have not been supplied by navigable watercourses they must be by a railway or vast territories must remain what they now are, deserts. The argument in favor of Government aid is as conclusive as it is simple.

There can be no doubt, if the railroads of the United States could have been secured in no other way, it would have been the soundest policy for Government to have assumed their construction even without the expectation of realizing a dollar of direct income from them. The actual cost of these works have been about $1,200,000,000. The interest on this sum is $72,000,000. They have created a commerce worth $10,000,000,000 annually. Such a commerce has enabled the people to pay $400,000,000 into the public treasury with far greater ease than they could have paid $100,000,000 without them. No line of ordinary importance was ever constructed that did not from the wealth it created speedily repay its cost, although it may never have returned a dollar to its share or bondholders. If this be true of local and unimportant works, how much more so must it be of great lines which will open vast sections of our public domain, now a desert but abounding in all the elements of wealth.

While therefore, there are but few cases which would justify the Government in extending aid to railroads, there are some in which its interposition becomes an imperative duty. In addition to the Central line now constructed, nothing could be more promotive of the general welfare than the opening by its aid both the Northern and Southern routes. Upon each of these are immense extents of territory full of natural wealth but which, without a railroad, are utterly beyond the reach of settlement or commerce. Aid extended to both lines, instead of weakening the public credit, would greatly strengthen it.

Source: Henry Varnum Poor, Annual of the Railroads of the United States, 1869-1874 (1869), xlvi-xlviii. https://archive.org/details/americanhistoryt00ivunse/page/514/mode/2up