In reading through my Corbin book, Across Iowa on the K&W
and H&S Railroads, I was reminded of some questions I have
had regarding early railroads, financing and building.
There are some good pages in there where Corbin describes some of
the components that made up the two respective railroads, but some
of the details (to me) seem to have been lost in time.
Perhaps someone here can share some insight...
So let me just state a few things which I think are incumbent upon
understanding the situation, someone can add or correct any of these
assumptions:
- 1850s-1880s settlements all wanted to be a part of the new
railroad system, as it meant easier transportation and
receiving/shipping of goods. Being left with no rail line at
all severely impaired the community. This meant that people in
town were willing to spend a lot of money to get a railroad to
their town.
- Railroad companies were willing to put in stations at set
intervals to bring more traffic to the railroad, leaving a 20
mile stretch of line without any station at all actually also
impaired the railroad if there were farms along the route.
Now to the questions...
- Why were there so many in-corporations that changed every few
years? A lot of the changes are not listed, so it makes me
wonder if they were all to bankruptcy? Or what? I'm guessing
that some of the incidents were the result of swindlers preying
upon towns who were willing to throw cash to anyone who seemed
like they could promise a railroad...and a lot of cash was being
thrown around.
- In the book, Corbin talks of some rivalry between the Wabash
and CB&Q for new territory. I'd be interested in hearing
how some of this worked, as it appeared that railroads were
started on behalf of other railroads with the sole purpose of
being under them. Was there a purpose for this? Federal law?
- Why were there so many bankruptcies in this early industry?
Miscalculation of funds required to build a railroad?
Miscalculation of railroad usage?
A little more discussion on how the early financing worked would
be interesting as well, I think. From what I can see, it appears
that a corporation is started, and then bonds sold to anyone who
would buy them (based on a dollar-amount-per-mile figure that the
railroad had come up with to support the building and creation of
the railroad). This this also include figures for purchase of the
locomotives and rolling stock? Or was it just trackage &
stations? Or even just trackage, and the stations would be
supported by either the railroad or the town?
Finally, I guess it all culminates with the eventual (and
somewhat rapid) downfall of the railroads, that in the early 1900s
the Model T began to give anyone the ability to move goods and
people easily, and therefore the decision to drive cattle or
people to a larger town rather than wait on rail
shipment/transportation (and possible tariffs) just offset the
original usefulness and convenience of the railroad.
At any rate, I'm sure this group has people who are very
knowledgeable in this subject, as always... :)
Cheers!