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In 1862, Congress hastily passed the Pacific Railroad Act. This act led to the creation of the Union Pacific, which would lay rails west from Omaha, and the Central Pacific, which would start in Sacramento and build east. Since congressmen wanted the road built quickly, they made two key decisions. First, they gave each line twenty alternate sections of land for each mile of track completed. Second, they gave loans: $16,000 for each mile of track of flat prairie land, $32,000 per mile for hilly terrain, and $48,000 per mile in the mountains.
The UP and CP, then, would compete for government generosity, and the line that built the most miles would get the most cash and land. The railroad would be financed by selling this land. Consequentially, since building fast brought in more cash than building efficiently, the two lines spent little time choosing routes; they just laid track and cashed in[27]. Burton Folsom, in The Myth of the Robber Barons, separates entrepreneurs of this time into two groups; the political entrepreneurs and the market entrepreneurs. The former tried to be successful in business through federal aid, pools, vote buying, or stock speculation. The latter tried to create and market a superior product at a low cost. The political entrepreneurs usually were the classic Robber Barons, as in the case of the Union Pacific and Central Pacific railroads[28].
The subsidies affected the UP builders' strategy in the following ways. They moved west from Omaha in 1865 along the Platte River. Because they were being paid by the mile, they sometimes built winding roads to collect for more mileage. For construction they used cheap and light wrought iron rails. Vice-president and manager Thomas Durant stressed speed, not workmanship. Also, since trees were scarce on the plains, Durant and his chief engineer Grenville Dodge had barely enough wood to make railroad ties, 2300 of which were needed to finish each mile of track. Sometimes they shipped in wood, other times they used the fragile cottonwood found in the Platte River Valley. Often, though, they solved their problem by passing it on to others. The UP simply paid good wages to tie-cutters and daily bonuses for ties received. Thus crowds of tie-cutters invaded Nebraska to cut trees wherever they were found, and deliver freshly cut ties right up to the UP line. The UP leaders conveniently argued that, since most of Nebraska was unsurveyed, farmers in the way were therefore squatters and held no right to any trees on this 'public land'. Some farmers used rifles to defend their land. Following this violence, even Durant discovered "that it was not good policy to take all the timber[29]".
Building problems took a turn for the worse in the harsh Nebraska winter. With the subsidies in mind, Dodge had no time to waste and laid track on ice and snow anyway. Needless to say, the line had to be rebuilt in the spring. On top of that, unanticipated spring flooding along the Loup fork of the Platte River washed out rails, bridges, and telephone poles, causing damage worth at least $50,000 the first year. Not surprisingly some observers estimated the actual building cost at almost three times what it should have been[30].
In the spring of 1868, the UP came out of the long Wyoming winter and began laying track west of Cheyenne. General Jack Casement's work train was lengthened to eighty cars, which now included a bakery car, a bath car, a complete feed store and saddle shop, additional kitchen, dining, and bunk cars, a combined telegraph and payroll car, and a butcher's car. The butcher's car was kept filled with fresh beef from a cattle herd that was driven alongside the work train each day. Occasionally a newspaper that followed the Hell on Wheels towns would operate temporarily from one of the cars, publishing whenever there was enough news concerning events along the way. For protection in case of Indian attacks, the Casements installed about a thousand rifles in the ceilings of the cars. Extra protection was guaranteed by the railroad's good friend General Sherman, who dispatched five thousand infantrymen and cavalrymen deployed at public expense from Cheyenne to the Salt Lake Valley[31].
The Indian attacks caused the loss of hundreds of lives and further ran up the cost of building. The Cheyenne and the Sioux assaulted the road throughout Nebraska and Wyoming; they stole horses, damaged track, and scalped workmen along the way. The government paid the costs of sending extra troops along the line to help protect it. But after they left, the graders, tie-setters, track-layers, and bolters often had to work in teams with half of them standing guard and the other half working. In some cases, such as the Plum Creek massacre in Nebraska, the UP attorney admitted his line was negligent. It had sent workingmen into areas known for the presence of hostile Indians[32]. To avoid such conflicts, Central Pacific superintendent James Strobridge offered some of the Indians employment and then signed a special treaty with the Paiutes and Shoshones. Both male and female Indians worked alongside the Chinese, "with nonchalance and ease", and one observer reported that the women usually outdid the men in handling crowbars and sledgehammers[33].
But no matter how hard he drove his men, by the end of 1868 it became obvious that the rival Union Pacific was going to win the great race into Utah. It would probably have tracks laid to the key city of Ogden before the Central Pacific could emerge from the Promontory range north of Great Salt Lake. A feeling of excitement developed throughout America as it became apparent that the long-dreamed-of transcontinental railroad, which had been planned for completion during the nation's centennial celebration of 1876, would be joined in the new year of 1869, seven years ahead of schedule.
Although engineers for each of the rival railroads could have calculated the approximate meeting place of the track layers, their greedy employers insisted that the wasteful parallel grading continue across Utah[34]. As the UP and CP entered Utah in 1869, the competition became more intense and more costly. Both sides marked roads that paralleled each other and both claimed subsidies for this mileage. As they approached each other, the workers on the UP, mostly Irish, assaulted those on the CP, mostly Chinese. In a series of attacks and counterattacks, with boulders and gunpowder, many lives were lost and miles of track were destroyed. Both sides involved Presidents Johnson and Grant in the feuding. With the threat of a federal investigation hanging over their heads, the two lines finally compromised on Promontory Point, Utah, as their meeting place[35].
The Union Pacific did not win the race into Utah without enormous costs - in money, materials, and lives. As in war, the longer the contest continued, the more ruthless the leaders of the competing railroads became toward their common laborers. Although deaths by accidents were higher among the CP's Chinese (between five hundred and a thousand), the UP lost the most workmen from exposure and from diseases contracted in the "squalid dens of prostitution" that followed the crews westward. More UP workmen were murdered in the Hell on Wheels towns than were killed in accidents, a ratio of about four to one. Neither railroad company provided adequate medical facilities. Yet, with the help of the national press, the railroad owners released a steady propaganda upon the public that was designed to inspire their sweating workmen to "win" at any price[36].
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