Thursday, August 18, 2005

Question: Role of Government in RR Construction Funding

Was the payment for the Transcontinental Railroad the best idea (part government, part private companies)?

8th grade essay in FL


Blogger CPRR Discussion Group said...

There was a national consensus to build a railroad to the Pacific to fulfill manifest destiny, as shown by the party platforms of both the Democrats and Republicans. The goal was partly economic – to foster domestic and international trade – but also partly a military and political goal to create a coast to coast nation, at a time before building the railroad entirely with private funding was fully justified economically. If you except this premise, the involvement of the government in funding the project using land grants and bonds was essential at the time. However, in the same way that you pay (not the bank) when you get a construction loan to build a new house, the transcontinental railroad project wasn't actually paid for by government, because government funding was in the form of bonds that had to be and were repaid by the railroads, not as grants funded by taxes. Similarly, the land grants were not subsidies because the government retained half the land (in a checkerboard pattern) and the project was to make the worthless wilderness grant lands valuable for both the railroads and the government as land owners as a result of building the railroad. Actually, the project was a billion dollar windfall for the government, just based on the discounted transportation costs for carrying the mail. Perhaps others might have a different opinion.

8/18/2005 7:30 PM  
Blogger CPRR Discussion Group said...

For further information about financing the cost of the transcontinental railroad, see "the $64,000 question."

8/19/2005 11:34 AM  
Blogger CPRR Discussion Group said...

From: "Wendell Huffman"

In my opinion, the primary reason it took so long to build a Pacific railroad (that is, the only reason it wasn't built in the 1850s) was the issue of how it was to be financed. And even then, it wasn't so much a question of how it was to be financed but, rather, who was going to control the financing.

There was no way to do it without government involvement for the simple reason that the federal government held title to most (if not all) of the land over which the railroad would pass. To my knowledge, every plan ever presented to congress from 1845 to 1862 involved the donation to the railroad company of right-of-way and alternate sections for some distance on either side of the railroad. It was originally felt that the value given to that land by the railroad itself would enable the company to generate all the money it needed for construction by selling said land (and at the same time enable the government itself to make money by selling their own adjacent sections). Indeed, it was such a good plan that there ensued fifteen years of fighting by various parties who wanted to cash in on the project.

The issue of slave state vs. free state did not really enter into the equation until 1854 following Stephen Douglas' "popular soverignity" compromise in the Kansas-Nebraska legislation and the 1857 Dred Scott nullification of the slavery restriction of the Missouri Compromise – and by implication that of the Land Ordinance of 1787. But all that, of course, led to the Civil War, which is ultimately what ended the haggling over control of financing and routes, and which also introduced the need for direct government loans for construction of the railroad.

The issue of the government's loan to the company for railroad construction was apparently a result of the realization that increased land value alone would not generate money fast enough to pay for the railroad as fast as the Civil War situation demanded. The Republican-led federal government recognized that speed of construction on the Pacific railroad was as essential to the preservation of California and Oregon within the Union as the Civil War was in maintining the Union in the East. And California gold, and Nevada silver, were essential to pay for the war; it was essential that California (in particular) not secede from the Union.

In other words, the government loans to the railroad companies for the construction of the Pacific railroad were not intended merely to build the railroad. Rather, they were intended to preserve the Union by assuring the completion of the Pacific railroad within the perceived time limitations.

—Wendell Huffman

8/19/2005 11:39 AM  
Blogger CPRR Discussion Group said...

The U.S. Supreme Court cites historian P. Gates, History of Public Land Law Development 345-346 (1968), that railroad land grants were not subsidies:

" ... donating alternate sections or one half of the land within a strip along the line of the project and reserving the other half for sale. ... the price of the reserved sections was doubled so that it could be argued, as the Congressional Globe shows ad infinitum, that by giving half the land away and thereby making possible construction of the road, canal, or railroad, the government would recover from the reserved sections as much as it would have received from the whole."

8/28/2005 11:19 AM  
Blogger CPRR Discussion Group said...

Andrew Dow wrote ...
Subject: Subsidies, and suchlike

" ... Am I not right in thinking that the railroads were meant to pay for the land, after a period. And did they not do so? ... "

12/03/2005 9:41 AM  
Blogger CPRR Discussion Group said...

No and No. The idea of the land grants was quite different, and did not represent a subsidy. The government gave the railroads half of the almost worthless land in alternating squares, and kept the other half. When the railroad was completed, the government's half of the land was made valuable, just like the railroad's half. Tax revenues also increased due to increased economic activity. So the net result was a government windfall, not a subsidy to the railroad. Land grants were not a zero sum game – everyone (government, railroad companies, businesses generally, and the traveling public) became much richer. What the railroads (CPRR & UPRR) were meant to repay – and did repay in full with interest – were the loans (government bonds). The government also got a huge windfall in discounted transportation costs for mail, etc, lasting most of a century and worth a billion dollars.

12/03/2005 9:53 AM  
Blogger CPRR Discussion Group said...


Using the example of the Central Pacific and Union Pacific Railroads, land grants were given (with no monetary payment from the railroads to the government) to the railroads (based on mileage completed and accepted by government inspectors), but in addition the railroads received government 30-year bonds which they were expected to repay with interest – and did. Further, in return for the government support, the railroads were to move government freight at reduced rates – which they also did. Finally after WW II a law was passed relieving the railroads of the obligation to move government freight at reduced rates. Economic historians have calculated that the return the government received on its investment in support of the railroads was very high, and would make most private corporations green with envy. In other words, the government (that would be us tax payers) received/saved much more money in the deal than the railroads received, even allowing for time payments/interest/inflation.

Government land grants and support for other lines (Northern Pacific, Southern Pacific, Atlantic & Pacific, etc.) varied somewhat from what the Central Pacific and Union Pacific received (generally lower levels of support), but the general pattern was the same, including the obligation to move government freight at reduced rates.

Kyle K. Wyatt
Curator of History & Technology
California State Railroad Museum
111 "I" Street
Sacramento, CA 95814

[from the R&LHS Newsgroup.]

12/03/2005 10:19 AM  
Blogger CPRR Discussion Group said...

Subject: Land Grants

... I have tracked down a paper (23 pages) on Land Grants, written by Robert Selph Henry in the Mississippi Valley Historical Review, in 1945. As you probably know, Henry was a public relations specialist and a senior official in the Association of Amercian Railroads. The paper does not cover the entire subject, but was written to correct the erroneous statements about land grants in no less than 37 school textbooks. A shame that is was ever required.

... It is very informative and underlines my thoughts that over the years railroads (and railways in this country) have too often been misrepresented by people who care not for accuracy or fairness. ...


12/30/2005 8:05 AM  
Anonymous Anonymous said...

See U.S. should do what it's always done – innovate discussing similarities between building a transcontinental railroad and achieving energy independence.

4/07/2007 6:59 PM  
Blogger CPRR Discussion Group said...

Ronald Bailey at Reason argues that:

"The fact that government subsidies were not necessary for building a transcontinental railroad was proved when James J. Hill built the highly profitable Great Northern Railway from Minnesota to Seattle completely without them or land grants."

2/05/2008 6:34 PM  
Blogger CPRR Discussion Group said...

Also see this additional discussion.

8/01/2008 12:53 PM  
Anonymous Anonymous said...

"James J. Hill ... is a great story because while the federal government is literally throwing money at the Union Pacific and Central Pacific, he builds a transcontinental railroad without a dime of government money. In the process, he has to take every precaution that it’s profitable: he keeps his depots close to his endpoints to minimize transporting supplies; he learns agriculture and breeding, then gives away land to farmers, so that he’ll have future customers; he never builds on inclines if he can help it, even if the terrain is ugly. It paid off: In the Panic of 1873, he’s the only one who doesn’t go broke among the transcontinental." —Dr. Larry Schweikart quoted in the Philadelphia Bulletin

12/12/2009 5:38 PM  
Blogger CPRR Discussion Group said...

See additional discussion.

3/08/2010 6:58 AM  
Anonymous Anonymous said...

See, The Central Pacific Railroad and the Railroad Land Grant Controversy by Heywood Fleisig in "The Journal of Economic History," Vol. 35, No. 3 (Sep., 1975), pp. 552-566.

5/17/2010 1:19 PM  
Blogger CPRR Discussion Group said...

"The [transcontinental railroad] connection saved the government $7 million — worth $120 million today — a year on mail delivery ... "

12/07/2010 11:10 PM  
Blogger CPRR Discussion Group said...

"The funding that supported the building of a transcontinental railroad by the Union Pacific and Central Pacific railroads came in the form of bonds backed by federally owned public lands that came into the possession of the federal government from the Louisiana Purchase and the Mexican War. ... The federal government, under the terms of the Pacific Railroad Act, provided the bonds—which is to say, the loan guarantees—but it provided no operating funding, no management oversight, and no ongoing regulatory bureaucracy."

2/10/2012 3:37 PM  
Anonymous Anonymous said...

Also see related article again pointing out that Abraham Lincoln actually was not the father of big government.

10/04/2012 1:10 PM  
Anonymous Anonymous said...

See related discussion.

2/02/2022 9:14 AM  
Anonymous Anonymous said...

Correction: "If you except this premise" above should read "If you accept this premise" (mistaken homonym substitution is a big problem, especially with dictation software)

2/14/2022 6:00 AM  
Anonymous Anonymous said...

[from the R&LHS Newsgroup.]

Building the first transcontinental railroad
From: emfag108
Date: Sat, 09 Jul 2022
I have a question related to the building of the first transcontinental railroad. As we all know, two companies were involved, the UP and the CP. I just read that the government appointed one-fourth of the UP’s directors. It appointed none of the CP’s. Why was that? What was the basis for such a difference?
I was made aware of this by Wallace D. Farnham's essay Shadows from the Gilded Age: Pacific Railwaymen and the Race to Promontory - or Ogden? which was read at the Golden Spike Symposium in May, 1969. It was published in the 1973 book by University of Utah, The Golden Spike, Dr. David E. Miller, editor. Dr. Farnham was a Professor of History at the University of Wyoming. ...
—Ed Faggart, Lincolnton, NC

From: Seth H. Bramson
Date: Sat, 09 Jul 2022
... While I was not aware of the issue which Ed has brought up re the government appointing ¼ of UP’s directors and none of the CP’s, I wonder if the response might not be that (if I remember correctly) the builders of and the board of, the CP were/was controlled by California's 'Big Four,' Crocker, Huntington, Stanford and [Hopkins] who, possibly, with their clout, money and connections, might have told 'the government' that the CP board was in place and that they (The Big Four), with said money, clout and connections, did not need 'the government' placing others ('outsiders?') on their board.

From: Chuck Spinks
Date: Sat, 09 Jul 2022
The July 1, 1862 Pacific Railroad Act created the Union Pacific. It did not exist before July 1, 1862 so it had no owners, officers, or board of directors.
The Central Pacific Railroad already existed. It was incorporated in California on June 28, 1861, one year before the Act.
I'm impressed that you found Farnham's excellent 1969 essay. Most historians that wrote about the First Transcontinental Railroad miss the fact that the Central Pacific construction was approved by the U.S. Government to a point just north of Ogden, not just to Promontory.
—Chuck Spinks, Auburn, CA, CSRM Docent

From: Chuck Spinks
Date: Sat, 09 Jul 2022
Since Theodore Judah, the Chief Engineer of the Central Pacific, was very involved in the preparation of the 1862 Act while in D.C., he had some influence on the language in the Act.
Section 9 of the Act recognized that the Central Pacific was already authorized by the State of California to construct to the State line with Utah Territory, and added that the construction of the Central Pacific would be under 'the same terms and conditions' as the Union Pacific. This meant they would have the same financial and land grant benefits.
Section 10 of the Act allowed the Central Pacific to continue construction beyond the state line 'to the Missouri River' or until they met the Union Pacific.
The FIVE primary investors running the Central Pacific at the time of the approval of the 1862 Act were Leland Stanford, James Bailey, Collis Huntington, Charles Crocker, and Mark Hopkins. James Bailey has been forgotten by historians because he left the company in late 1863, before the main construction push. The 'Big Four' term is not applicable until after Edwin Crocker has a stroke and retires from the leadership team in June 1869. From June 1869 until Hopkins dies in March 1878, the famous “four” were in charge.
—Chuck Spinks


7/11/2022 10:16 AM  
Anonymous Anonymous said...


From: Kyle Wyatt
Date: Sat, 09 Jul 2022
The Union Pacific as a corporation was created out of the Pacific Railway Act legislation. The government played a central roll in creating the corporation; and the government got representation on its board.
The Central Pacific, on the other hand, was an already established California corporation, founded the previous year, with agents in Washington in 1863 actively lobbying for passage of the legislation. One of those agents, CP Chief Engineer Theodore Judah, also served as Secretary for the Congressional Joint Pacific Railway Committee. (Concepts of “conflicts of interest” were very different back then.) Another agent, CP Vice President Collis P. Huntington, carried with him a personal letter of introduction from CP President Leland Stanford, also at that same time Governor of California, commending Huntington to President Lincoln. The core directors of the CP in the 1860s, Stanford (the politician of the group), Huntington, Charles Crocker, Crocker’s elder (and more important back then) brother Judge E. B. Crocker, and Mark Hopkins, were also active politically, playing central roles in the founding of the Republican Party in California in the latter 1850s. (Thus as the leading politician of the group and the leader Republican Party in California, Gov. Leland Stanford already had an established relationship with Pre4sident Lincoln.)
Oh, the tangled webs they wove.
—Kyle Wyatt

From: railbass
Date: Sat, 09 Jul 2022
The 'big four' of the Central Pacific were Leland Stanford, Collis P. Huntington, Charles Crocker, and Mark Hopkins.
—John Manion, Denver, CO

7/11/2022 10:18 AM  
Anonymous Anonymous said...


From: emfag108
Date: Sat, 09 Jul 2022
Thanks all, that is very interesting indeed. Let me state what I understand from you to ensure a feeble-minded person like myself had this straight.
Basically, the UP did not exist as a company at the time of the Pacific RR Act of July 1, 1862. Thus, the UP was created under that act of the federal government. It was not charted previously in a state, such as Nebraska.
On the other hand, the CP existed under a charter of the State of California with rights/authority to build to what is now essentially the California/Nevada state line. It had a defined corporate structure consistent with that charter, and possibly related legal documents such as articles of incorporation.
The federal act in 1862 gave the existing CP additional authority, which was to build to the Missouri River. In other words, they could build all the way or until meeting the UP.
Have I got the big-picture straight? If so, here are two follow-on questions directly related to the government naming board members. I would be grateful for answers from you and/or others on this discussion list.
First, why was the CP not required to amend, revise, or whatever, their legal framework for existing as a company to allow government folk on the board in exchange for that substantial additional authority granted them? Such a change may have involved an act of the legislature there. It seems that the Feds wanted to be involved with the process based on what they required for the UP board. What is the deal on this aspect? The CP did stand to benefit financially from the Federal government.
Second, did those in the leadership team forming the UP object to the government's involvement with the board of directors. I would think they would like to be organized similar to the CP.
Chuck, I appreciate your comment regarding being impressed with finding Dr. Farnham's essay. That is kind of you to say. However, I cannot take any credit. It was not my doing. At the recent UPHS meeting in Cheyenne, there was a brief side-discussion in which someone stated the CP had graded as far east as Ogden. I was curious about that. Knowing Don Strack is knowledgeable of the railroad scene and its history in Ogden, I reached-out to him. In the course of several emails, he shared with me a list of helpful reference books. One was the title shown in my initial post. Our local library has the best Inter-library loan staff on the planet. They promptly got me a copy. Thus, Don gets all the credit. His is very knowledgeable and helpful, a great guy indeed.
This railroad history stuff is definitely a team sport. I have been very blessed over the years to have crossed paths with some extremely knowledgable and helpful folks. At each meeting I attend and in follow-up emails, I learn a tremendous amount. For me, having two ears, two eyes, and one mouth is a benefit.
Chuck, you may find it interesting that I forwarded Don the Civil Engineering paper you shared with me on tunnels of the transcontinental railroad, acknowledging your role . He had never seen it before and learned some new information about the UP tunnels there in Weber and Echo. Don was quite pleased. It is a team sport.
Thanks again for all who commented and for the anticipated answers to my above two questions.

7/11/2022 10:19 AM  
Anonymous Anonymous said...


From: Kyle Wyatt
Date: Mon, 11 Jul 2022
The question related to Government appointed directors for the UPRR, and not the CPRR probably requires some background.
The original creation of the Union Pacific was by a process outside the norms of corporate creation of the time (it harkened back to an earlier time in some ways), and so had some unique characteristics. First the Union Pacific was “Chartered” by the Federal Government through the Pacific Railway Act (as distinct from “Incorporated” under the laws of a State). Second, in normal company (or corporation) creation a group of people would come together to form a new company. They would associate together for that purpose (often with a certain degree of formality), and then (if they chose) formally incorporate a company. This would be followed by an organizational meeting to elect officers and a board of directors. (Separate note, many companies did not incorporate, but remained partnerships – for instance Baldwin was a series of partnerships until 1909 when it finally incorporated.) After formally organizing, books would be open for subscription of stock – typically with a 10% up-front payment made for shares subscribed, providing initial funding for the company. But in the case of the Union Pacific there was no group coming together to create it, so the Pacific Railway Act created a mechanism to accomplish that.
Section 1 of the Pacific Railway Act, the opening (long) paragraph running several pages, served like the articles of incorporation would in a normally created corporation. It begins by listing 161 prominent individuals, representing every State and several Territories (excepting those States in the Confederacy). The California contingent of this list was 15 people, second only to the 24 listed for New York, and ahead of the 13 listed for Pennsylvania. Most States had considerably fewer individuals listed. Further, the list was not intended to be exhaustive; provision for additional people was included. In addition, the Secretary of the Interior was to name 5 more individuals.
Of interest, the California contingent included CP Huntington, TD Judah, James Bailey, and Charles March of the Central Pacific RR, but also several members of the San Francisco & San Jose RR, several other members of the Sacramento Valley RR, along with other prominent Californians such as banker DO Mills.
Under the Pacific Railway Act these 166 people (plus any later additions) were to constitute the “body corporate” of “The Union Pacific Railroad Company,” the official name of the new corporation. Further, this same 166 people were also, as laid out in the Pacific Railway Act, constituted as Commissioners in a body to be called the Board of Commissioners of the Union Pacific Railroad and Telegraph Company, with a quorum for transacting business set at 25. The Commissioners were to hold an organizing meeting in Chicago within 3 months, to elect officers, and to open the stock books for subscriptions.
Once 2,000 shares of stock had been subscribed, with $10 per share actually paid up front, the officers of the Commissioners were to call a meeting of stockholders, who would elect a board of directors (which in turn would select its own officers). In addition to stockholders elected to the UPRR board of directors, the US President was to appoint 2 additional directors – increased to 5 in 1864 – (who specifically could NOT be UPRR stockholders). Once the new stockholder board of directors was established and certified, the officers of the Commissioners would then turn over to the new board of directors all books, records, property and other assets of the Union Pacific RR. The Commissioners would then cease to exist, and the shareholders would constitute the “body corporate” of the UPRR.


7/11/2022 10:26 AM  
Anonymous Anonymous said...

From: Kyle Wyatt
Date: Mon, 11 Jul 2022
In the event, on September 2, 1862 the "Board of Commissioners of the Union Pacific Rail Road and Telegraph Company" met in Chicago to organize the company and choose its officers. Stock books were opened for subscription, but results were, let us say “underwhelming.” It was not until October 30, 1863 that the company was formally organized in New York City at the first stockholder meeting, electing its Board of Directors and officers. Per the New York Times, October 31, 1863, Page 6, 30 stockholders were elected directors at the meeting of Oct 29, and officers were elected at the directors meeting Oct 30. The article made no mention of Government appointed directors – those most likely came after the Oct 1863 organizing meeting. The number of UPRR stockholder elected directors were later reduced to 15 in 1864, and varied thereafter. (The Official Register of Union Pacific Directors and Officers, 1863-1889 can be found through Google Books – I downloaded a digital copy from UC Berkeley. It includes the Government directors.)
As to why the Central Pacific was not required to have Government appointed directors, I do not know – but I can speculate on several possible reasons.
As a corporation formed under the laws of the State of California, the US Government did not have the legal right to alter State laws covering corporations. This also may explain why a third railroad listed in the Pacific Railway Act, the Leavenworth, Pawnee, and Western RR of Kansas (LP&WRR), later Union Pacific Eastern Division (separate from UPRR), still later Kansas Pacific, did not have Government directors – it being incorporated in Kansas.
Note the Pacific Railway Act set up a race to the 100th meridian between the UPRR and the LP&WRR – first one there had the right to build further west to meet the CPRR. UPRR won that race in the end.
Given the deep involvement of Congress in creating the UPRR in the first place, and its ability to shape that organization, they took the opportunity to insert Government directors to (they hoped) keep an eye on the Government’s investment. (They underestimated the wiles of Thomas C. Durant.)
Given that the CPRR was only expected to build to the California-Nevada line, the vast majority of the construction was expected to be by the UPRR – and that would be the important company to keep an eye on. (Even meeting at Promontory, the UPRR still built the substantial majority of trackage.)
The Central Pacific was politically well connected at the beginning. Remember TD Judah was the Secretary for the Congressional Joint Pacific Railway Committee which was actually writing the act, and Leland Stanford, President of the CPRR and Governor of California (concurrently) was well connected and known among Republican politicians. They would have worked to prevent the insertion of Government directors to the CPRR. Further, through out the 1860s CPRR maintained good relations and a reputation for open, honest dealings with the Government, including Commissioners inspecting completed railroad – this in contrast to Durant of the UPRR who Government officials did not trust (with good reason). Events tended to reinforce that the UPRR under Durant needed careful watching, while the CPRR did not need to be watched so carefully (but still did not get a free ride).
As to whether the UPRR leadership objected to the Government directors, I’m sure Durant would have preferred they not exist, but it was a “given” so I suspect he just lived with it and found ways around them.
A long answer, but I hope it helps.
Lots of original documents shedding light on all this are available on-line these days.

7/11/2022 10:38 AM  
Anonymous Anonymous said...

[Above courtesy of the Railway & Locomotive Historical Society Internet Message List.]

7/11/2022 11:06 AM  
Anonymous Anonymous said...

[Continued, additional from the R&LHS Newsgroup.]

From: Kyle Wyatt
Date: Mon, 11 Jul 2022 06:15:17 PDT
I’ll elaborate and refine Chuck’s comments on the 'Big Four' (a term of frequent historical inaccuracy that I really dislike, as I’ll explain). They referred to themselves as the Associates.
First, when studying the CPRR in the 1860s, many researchers have assumed every 'Crocker' is Charles Crocker; in fact many, probably the majority of references in this period to 'Crocker' and the CPRR are actually EB Crocker, elder brother to Charles.
1861-6-28 Central Pacific Rail Road Company of California incorporation papers filed in the office of the Secretary of State. CPRR directors include Leland Stanford, Charles Crocker, James Bailey, TD Judah, LA Booth, CP Huntington, Mark Hopkins all of Sacramento, Charles March of Nevada City, and DW Strong of Dutch Flat, Placer County. These remained the directors in 1862.
1862-7-1 Pacific Railroad Act signed by President Abraham Lincoln
1862-12-24 Charles Crocker resigned from CPRR Board of Directors. He took a master contract for construction of first sections of CPRR, initially sub-contracting many sections
1863-5-22 Gov Stanford appointed EB Crocker to temporarily fill the vacancy on the California Supreme Court created when California Chief Justice Field was appointed to the US Supreme Court. EB Crocker’s term on the California Supreme Court expired Dec 31, 1863.
1864-3-1 In report to US Treasury, EB Crocker is listed as a CPRR Director; he has also been the CPRR Attorney since at least mid February 1864
From March 1864 until his stroke in July 1869 EB Crocker was a major official for CPRR – if there was a “Big Four” in this period, it was Stanford, Huntington, Hopkins, and EB Crocker (not Charles Crocker). As late as 1870 EB Crocker was still listed as a Director of CPRR, stroke notwithstanding.
In late 1869 Charles Crocker had also returned to the CPRR board of directors, and was also 2nd Vice President. Charles had also been Superintendent of the CPRR during most of construction, and remained that until the arrival of AN Towne in September 1869.
In July 1871 Charles Crocker announced a 2-year trip to Europe. In August he left the CPRR board, and resigned as 2nd Vice President. Charles and EB together had negotiated a sale of their CPRR interests to the other Associates.
The Panic of 1873 changed everything. The early 1870s had already been difficult in California – CPRR was reported behind on payment to employees in March 1873. In September 1873 Mark Hopkins announced major CPRR retrenchments in a speech. The Associates were unable to make their payments to Charles Crocker, forcing him to “repurchase” his interests in CPRR in late 1873. He was listed as a CPRR Director after the July 1874 Annual Meeting.
So Charles Crocker was one of the founders of the CPRR in 1861, but left the CPRR board in December 1862 to head up construction through a series of companies. And EB Crocker joined the CPRR board in early 1864. Depending how you want to count it, either the 'Big Four' excluded Charles between late 1862 and early 1870, or it was the 'Big Five' during most of those years. Then in 1871 both Charles and EB completely sold their CPRR interests.
Charles returned in late 1873-mid 1874, and them Mark Hopkins died in March 1878 – ending the 'Big Four' as a set of Stanford, Huntington Hopkins and Charles Crocker.
So there are not a lot of years when the purported 'Big Four' actually existed.
But the name lives on – especially in the 20th-21st centuries – thanks in significant part to Oscar Lewis' 1938 book by that name (although the name itself does date to the 19th century).
—Kyle Wyatt



7/12/2022 10:09 AM  
Anonymous Anonymous said...


From: Chuck Spinks
Date: Mon, 11 Jul 2022
Kyle gives an excellent detailed account of the early organizational differences between the UPRR and the CPRR under the 1862 Act. When I was a new CSRM docent a decade ago, Kyle was a mentor that emphasized the importance of primary source research and questioning and verifying secondary sources, which is reflected in his account.
As a civil engineer, my research emphasis has been with the civil engineers and the construction of the early railroads. Kyle mentions the lack of trust the government had in Thomas Durant, which was a UPRR liability throughout the construction period. It’s remarkable that Grenville Dodge and Samuel Reed of the UPRR were as successful at pushing the railroad forward as fast as they did, despite Thomas Durant and Silas Seymour. In contrast, Samuel Montague and Lewis Clement of the CPRR, even with the huge civil engineering and construction challenges of the Sierra Nevada, were able to do their jobs and keep the line advancing within a much more cohesive and supportive management structure.

7/12/2022 10:10 AM  
Anonymous Anonymous said...

Also see, Which railroad did not use government land.

12/22/2023 6:14 AM  
Anonymous Anonymous said...

Also see, government funding.

1/30/2024 5:36 PM  
Anonymous Anonymous said...

See related.

2/29/2024 7:43 AM  

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