1. 14.2 The age of railroads OBJECTIVES:
Identify the role of the railroads in unifying the country
List positive and negative effects of railroads on the nation’s economy
Summarize reasons for, and outcomes of, the demand for railroad reform

2. Promontory Point: Golden Spike!!
Union Pacific (East to West) construction begins during Civil War
Central Pacific (West to East) begins after
Golden Spike driven in Ogden, Utah 1869
Promontory Point

Effect: Unites East and West; Opens trade with Asia

3. RAILROADS OPEN THE WEST
US govt. gives huge land grants to railroad companies to encourage construction
Union Pacific and Central Pacific meet at Promontory Rock, Utah on May 10, 1869.
Railroads built with Irish, Chinese, Mexican and African American labor.
Homesteaders and immigrants flood west on new railways.

4. Introduction of time zones
How did people keep track of the time before times zones?
Why did they feel the need to adapt time zones for the railroads?

5. Map: Transcontinental Railroads and Federal Land Grants, 1850-1900
Despite the laissez-faire ideology that argued against government interference in business, Congress heavily subsidized American railroads and gave them millions of acres of land. As illustrated in the box, belts of land were reserved on either side of a railroad's right of way. Until the railroad claimed the exact one-mile-square sections it chose to possess, all such sections within the belt remained closed to settlement.
Copyright © Houghton Mifflin Company. All rights reserved.

6. New Towns and Markets
Examine the map on the next slide to understand how the transcontinental railroad changed the economy.

7. Map: Mining and Cattle Frontiers, 1860-1890
The western mining and ranching bonanzas lured thousands of Americans hoping to get rich quick.
Copyright © Houghton Mifflin Company. All rights reserved.

8. Pullman, Illinois George Pullman created a town for his workers
Created this town to ensure a steady workforce
Medical offices
Legal offices
Church
Library
Theater
Athletic field

9. Crédit Mobilier Scandal
Example of profiteering and greed of industrialists
Union Pacific stole over $25 million from the government
Basically a “front company” formed by the financiers/builders of the Transcontinental Railroad
Insiders of the Union Pacific Railroad hired and paid themselves as much as $50,000 a mile for construction that cost $30,000.
Stock was sold to influential Congressmen to keep them quiet.
New York Sun unearthed the scandal and kept attention on the “Trial of Innocents” = public figures in the Grant Administration and Congress that were involved. Only 2 Congressmen formally censured. Even Vice President Colfax escaped serious charges.

10. Granger laws Farmers were angry at the railroads for many reasons
Businesses were given the land grants instead of farmers
Railroads entered into formal agreements to fix prices to keep the farmers in debt
Railroads would charge different rates at different times to make a bigger profit (ex: RRs would charge a higher rate for a shorter trip, knowing there was no competition)
Munn v. Illinois allowed the states to control the railroad rates
IMPORTANT because now the Federal government can intervene with private businesses for the public good

11. Interstate commerce act
Grangers success was short lived
Wabash decision in 1886 overturned Munn v. Illinois because it dealt with interstate commerce
Why does this matter?
BUT, they instead passed the Interstate Commerce Act to regulate rates
Didn’t really gain the power it needed for about 20 years

12. What are the effects of the finalization of the transcontinental railroad?
Closing of the “Wild West”-ecological disaster
Spurs industrialization
Tie the country together/decline in sectionalism
Decline in Native American societies
Corruption/Speculation
Population shift
Time zones created
Millionaire class created (i.e Vanderbilt)
1886 – Supreme Court’s Wabash decision!!!
Interstate Commerce Act-1887!!!  the formation of the Interstate Commerce Commission

13. TERMS:
Transcontinental Railroad
George M. Pullman
Credit Mobilier
Munn v. Illinois
Interstate Commerce Act
OBJECTIVES:
Identify the role of the railroads in unifying the country
List positive and negative effects of railroads on the nation’s economy
Summarize reasons for, and outcomes of, the demand for railroad reform