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Iron Empires

The Growth of the American Railroad and the robber barons who built them

Published on August 5, 2020

Vanderbilt and Fisk Great Race Cartoon Cornelius Vanderbilt and James Fisk were two of the big investors in the American Railroad. Image: Library of Congress

Journalist and historian Michael Hiltzik was born and raised in the suburbs of New York City and educated in New York. After spending eight years as a foreign correspondent in Africa and Russia he returned to the US with his family and settled in Southern California. He tells us about the vicious competition between the railroad empire builders, featured in his book Iron Empires

Michael, Iron Empires, is all about the formation of the railroads in America. Why did you want to write about this aspect of American history?

I’ve always been fascinated by the effects of technology on history — my previous books include a history of the computer pioneers who invented the personal computer at the Xerox Palo Alto Research Center, PARC (Dealers of Lightning); the construction of Hoover Dam (Colossus); and the invention of the cyclotron and its impact on the course of physics in the '30s through the '60s, including the creation of the atomic bomb (Big Science). The development of the railroads during the Gilded Age of the late 19th century fit perfectly into this continuum — rail travel was a novel technology and the railroads became America’s first big business, guiding the course of the country’s growth for more than a half-century.

What prompted the mass expansion of the railroads in the late 19th century?

Several developments were luring Americans west during this period, including the discovery of gold in California in 1849, the desire of urban residents and immigrants from Europe for open spaces in which to set down new roots by farming, and the need of the railroads to find new markets beyond their previous concentration in the northeast and northern Midwest. Rail travel lacked the drawbacks of water travel, which had been the leading mode up to then — rivers and canals tended to be concentrated in the northeast and flow north-south, and were scarce in the arid west. Trains, however, could go wherever rails were laid.

Would you say that the expansion reflected the growth of America as a nation at the time?

The railroad expansion reflected the growth of America but also drove that growth. Government loans for construction of the transcontinental railroads were collateralized by grants of land along the railroad routes. To pay back the loans, the railroads had to lure settlers to those land grants, which in turn meant more produce for the railroads to carry to market and more freight to carry back to supply the settlers. It was a symbiotic process.

Who were some of the notable figures investing in railroad expansion?

The original railroad tycoons included Cornelius Vanderbilt, who had got his start as a ferry owner on the Hudson River; Jay Gould and Jim Fisk, who were stock market manipulators who saw railroad securities and their investors as ripe for plucking; J. P. Morgan, whose family firm served European investors interested in American railroads and consequently saw that he needed to play a role in managing railroad competition to keep it from diminishing railroad profits; and Edward H. Harriman, who understood that the key to making money on railroads was not to manipulate their securities, but upgrade them so they were efficient in operation and could make profits from actually serving their customers.

Many of the financiers involved in the railroad became known as 'robber barons', why was this?

The term was first applied to Vanderbilt, who had become known for ruthless business practices that didn’t always serve the interests of his customers or the public at large. Eventually it became applied to the railroad tycoons as a class, because by the end of the 19th century they were viewed as having accumulated their fortunes by cheating investors and profiteering from the shippers and passengers who depended on them. Their ostentatious lifestyles led them to be identified with excess. This wasn’t always a fair judgment, but in many cases it was true enough.

Sacramento Railroad Station Society was brought together by the Railroads, as this painting by William Hahn of Sacramento Railroad Station shows. Courtesy M. H. de Young Memorial Museum

What impact did the railroads have on life in America?

The expansion of the railroads impacted almost every aspect of American life. Railroad travel brought Americans of all socio-economic classes into close quarters on the trains. Women began to venture out of regimented home life and to live their lives in public. Commerce between far-flung communities expanded explosively. The railroads tied the country together — indeed, railroad travel forced the creation of time zones so that travelers would know by the clock when their trains would leave, what time they’d arrive at their destination, and when their interconnections would be made.

As America’s first big business, the railroads also had great impact on American politics — often thorough graft and bribery — and on American management methods. The same business methods that managed even a large textile plant with hundreds of workers would be inadequate for a railroad that spanned 3,000 miles and employed tens of thousands. American business management evolved rapidly.

What do you think the legacy of the railroad has been, both socially and economically, for America?

The railroads built an America that could not have been tied into a united country any other way. They shortened distances between the East Coast and West, allowed what otherwise would have been local or regional commerce and agriculture to become national, and vastly increased American wealth. They started the process of creating an "American" society out of what had been a fragmented network of local and regional duchies, especially in the prelude to the Civil War. They showed that exploiting a new technology was a path to riches and eventually to global stature for a nation that had previously been shy about taking its place on the world stage. That was a lesson that the US built upon throughout the next century.

Iron Empires Iron Empires, by Michael Hiltzik, is available now

What do you hope readers take away from reading the book?

I hope readers get a sense of the sweep of American history during the latter years of the 19th century, when the nation was becoming modern — as well as a feel for the scoundrels, heroes, and rank-and-file builders of the nation in this absolutely crucial period. And I hope they’re entertained by the shenanigans of people who were truly the founding fathers of the nation’s economy.

What's next on the horizon for you?

My next project is already in the works. It’s a history of California, due out in 2024, entitled Golden State.

Finally, what's the best thing about being Michael Hiltzik?

There’s my family — my wife, two accomplished sons (and three dogs). But also the privilege of being allowed to keep educating myself about topics that interest me, and then communicating to my readers what I’ve learned. Writing a newspaper column for the Los Angeles Times and writing books like Iron Empires is a joy, because I never have to be bored for even a minute of the day.

Iron Empires, by Michael Hiltzik, is out now. You can buy a copy at www.amberley-books.com/iron-empires.html

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