Railroad freight charges exceeded canal, river, and lakes shipping charges, except when railroads ran at a loss in order to crush or meet competition. Rail rates tended to be lower where the railroad faced water competition. Accurate average rail rates for the years before 1860 are not known. Canal rates averaged 2 cents a ton mile, river rates about 1 cent a ton mile, and rail rates around 4 cents a ton mile with water competition. Around 1850, rail rates sometimes went to 25 cents a ton mile without water competition. But rail transport still cost less than any other land transport.
By moving things faster the railroads saved money for shippers in spite of the high rail rates. Railroads also ran in more nearly straight lines than did rivers. The distance between Cincinnati and St. Louis, for example, came to 327 miles by railroad, but it was 720 miles by way of the Ohio-Mississippi waterway. With a shorter route, the railroad could charge twice as much per ton mile and still be competitive.
At first Americans copied the British design of roadbeds, locomotives, and rolling stock. But the roadbeds proved too rigid, and the locomotives too heavy. American engineers had to make the roads more flexible and distribute the weight of the engines more evenly. Robert L. Stevens, an American, probably was the first to use wooden ties under the rail on the Camden and Amboy Railroad in the 1830s. In a land of abundant forests, this was a logical solution. John B. Jervis of the Mohawk and Hudson Railroad designed and built the first locomotive with a four-wheel truck attached to the engine by a swivel. This lengthened the engine, allowed distribution of weight over a larger surface, and still enabled the machine to get around curves. In 1837, Joseph Harrison invented the equalizing beam which spread the weight of the engine equally to all driving wheels.
The first state incorporating charters for railroads either specifically regulated rates or made provisions for regulation. State legislatures issued the first charters since the first bureaus to handle incorporations did not appear until 1837. Even then entrepreneurs preferred to go to the legislatures because the railroads could get monopoly charters from the legislatures, but not from the bureaucrats who had no such authority. So special legislation created the corporations, and from the first, American railroads were at least technically subject to rate regulation.
The railroads as a group made up the first of the great corporations in America. Only later did manufacturers incorporate their companies. Corporations had the great advantage of being able to accumulate large quantities of capital and make it mobile. However, in the process of incorporation, actual ownership of the business became divorced from management. The railroads, owned and operated by corporations, were run by a professional managerial class who felt obligations only to themselves and their shareholders. They ignored the well-being of their patrons until abuses and oppressions had reached nearly intolerable proportions.
Impact of Railroads on Farming4
Railroads, even more than canals, influenced farmers in selecting their agricultural specialization. For example, dairying was developed along railroad lines. In 1851, cooled milk was moved from northern New York State to Boston. Grain could be sped from faraway Illinois, Wisconsin, and Michigan to be shipped to Liverpool and London. Manufactured products could be cheaply moved west, and the living standards of farmers improved. Farmers responded to the availability of cheap capital goods with increased commercial farming, made even more profitable with the building of railroads. But the new commercialism made the farmers dependent on the railroads. Railroads also meant that urbanites could obtain better and cheaper food.
Fast transportation by railroad had the most immediate influence on the producers of perishable commodities. As early as the 1830s, some American cities had become so large and congested that milk could not be moved from farms to the center of the city and still be fresh. As a result, large cities, such as New York, developed urban dairies. Large cow barns sheltered cows fed on distillery and brewery slop, supplemented with garbage. The rows of stabled cows were milked with little regard for sanitation.
The railroad, aided by new health regulations, slowly drove the urban dairies out of business. During 1842-1843, the Erie Railroad carried more than 750,000 gallons of milk into New York City. These deliveries increased greatly during the next decade in New York and other large cities as well.
The milk was refrigerated after a fashion by stirring it in cans with ice-filled tubes. The milk was cooled enough to reach the market in acceptable condition. Dairymen formed associations, set up receiving stations in the cities, and ran city delivery services. The consumer not only received a comparatively fresher product, with fewer health hazards, but the milk cost less. As a result, the per capita consumption of milk in the cities rapidly increased. This stimulated a greater specialization in fluid milk production on dairy farms near cities. As the railroads expanded, so did commercial dairying, which soon became one of the most significant farm specializations.
Producers of fresh fruits and vegetables also benefited from the railroad. Previously truck farmers were limited to the immediate vicinity of cities. The railroads, especially in New York and New Jersey, caused an increase in sources of supply during the 1840s and 1850s. Special express trains rushed truck produce to the city. Farmers began to grow many horticultural specialties, especially strawberries. The great increase in the supply of these specialties did not cause prices to fall because as the production expanded so did the demand. Urban consumers had long wanted the commodities now made accessible by the railroad.
The producers of dairy and truck crops became the first to depend on the railroads and also became the first victims of railroad policies. The truck farmer simply had to use the railroads, regardless of freight rates, because he could not store his crop. A western wheat farmer could, at least in theory, hold his product. Some milk could be used for cheese, but even this was a limited method for preserving milk. So, although not widely known, the eastern farmers were the first to object to rail monopolies. On the other hand, the proliferation of rail lines in the East sometimes provided farmers with alternative routes, and on the coast, short distance water transportation sometimes kept rail rates down.
The supply of certain fruits and vegetables became more certain and more continuous with the advance of railroads into the South. In the 1850s, New York City obtained fruits and vegetables from Virginia, the Carolinas, and Georgia. Truck farms and orchards flourished, particularly in the vicinity of shipping points such as Norfolk, Charleston, and Richmond. Some southern rail lines ran to the interior, and fruits were carried to ports and shipped by water to New York.
The cities of the interior and the South experienced similar changes. Fruit and vegetable growing and dairying were developed to supply Chicago, St. Louis, Cincinnati, and other cities. The rise of Wisconsin as a prominent dairying area can be linked to the growth of Chicago. Chicago merchants and railroads also reached into the Deep South for various horticultural specialties, a very significant development.
Two Centuries of Railroading in the U.S. – A Chronology
1797 The steam locomotive is invented in England.
1809 Thomas Leiper’s horse-drawn wooden tramway connected quarries in Delaware County, PA to a boat landing. This was the first time rails were utilized for freight transportation in the United States.
1823 The first public railway in the world opens in England.
1827 The first common-carrier railroad in North America - the Baltimore and Ohio - is chartered by Baltimore merchants.
1829 The Stourbridge Lion, imported from England, was experimentally operated on the Delaware and Hudson Canal Company’s railroad at Honesdale, PA. It was the first steam engine to run on commercial railroad tracks in the U.S.
1830 The first regularly scheduled steam powered rail passenger service in the U.S. begins operation in South Carolina, utilizing the U.S. built locomotive The Best Friend of Charleston.
1830 The Tom Thumb steam engine locomotive on the Baltimore and Ohio made the first successful railroad run in 1830 from Baltimore to Ellicott, MD at up to 18 mph carrying 26 passengers. A race was staged between this engine and a horse-drawn carriage near Ellicott’s Mills, MD. After the engine slipped a belt, the horse galloped to victory.
1831 The first U.S. mail is carried by rail on the South Carolina Canal & Railroad Company.
1831 Robert Livingston Stevens invented the T-rail design.
1832 The Staple Bend Tunnel on the Allegheny Portage Railroad, east of Johnstown, PA, is the first railroad tunnel built in the Western Hemisphere.
1833 Andrew Jackson travels from Baltimore to Ellicott's Mills, becoming the first sitting U.S. president to ride the rails.
1833 A total of 380 miles of rail track are in operation in the U.S.
1837 The first sleeping car, a crudely remodeled day coach, was placed in service on the Cumberland Valley Railroad between Harrisburg, PA and Chambersburg, PA.
1838 Five of the six New England states have rail service, as do such frontier states as Kentucky and Indiana.
1840 More than 2,800 miles of track are in operation.
1841 The first caboose, termed a way-car, was placed in service on the Auburn & Syracuse Railroad in New York.
1850 More than 9,000 miles of track are in operation in the U.S., as much as in the rest of the world combined.
1850 President Fillmore signed the Douglas Railroad Bill giving the state of Illinois 2.5 million acres to help in the construction of a 700-mile railroad from Chicago to Cairo in the south and to Dunleith in the north. This was the first land-grant legislation passed for the benefit of American railroads.
1851 First use of Samuel F. B. Morse’s telegraph for train dispatching in the United States on the Erie Railway at Turners, NY.
1852 For the first time, Pittsburgh, PA is linked to Philadelphia, PA via rail (using the inclined plane from Johnstown, PA to Hollidaysburg, PA) and via the Pennsylvania Railroad. Now rail development to the West can proceed apace.
1854 The Pennsylvania Railroad’s 1300-foot long Horseshoe Curve at Altoona, PA is opened for service. This reduced the travel time from Philadelphia to Pittsburgh from 3 ½ days to 13 hours.
1854 Attorney Abraham Lincoln represents the Illinois Central Railroad.
1856 The first railroad bridge across the Mississippi River was opened at Davenport, Iowa.
1859 The first Pullman Sleeping Car went into service.
1860 More than 30,000 miles of track are in operation in the U.S.
1860 President Abraham Lincoln formally inaugurates construction of the transcontinental railroad that will ultimately link California with the rest of the nation.
1861-65 The Civil War becomes the first major conflict in which railroads play a major role as both sides use trains to move troops and supplies.
1862 The first mail car for sorting mail en route is placed into service between Hannibal and St. Joseph, MO.
1865 The "golden age" of railroads begins. For nearly half a century, no other mode of transportation challenges railroads. During these years, the rail network grows from 35,000 to a peak of 254,000 miles reached in 1916.
1867 The first domestic steel rails are rolled by the Cambria Iron Works in Johnstown, PA using the Bessemer process.
1867 George Pullman and Andrew Carnegie approaches Durant of the Union Pacific with the idea of sleeper cars. George Westinghouse patents the air brake. The refrigerator car is developed.
1868 Eli Janney patents the automatic or “knuckle” coupler.
1869 On May 10, at Promontory, Utah, the "Golden Spike" joins the Union Pacific and Central Pacific railroads, marking completion of the transcontinental railroad.
1872 Presidents from Ulysses S. Grant to Franklin D. Roosevelt travel largely by train. For them, as for virtually every American, the railroad offers the fastest, safest means of travel.
1882 The Erie’s Kinzua Viaduct is completed near Mt. Jewett, PA. At 301 feed high, it is the nation’s highest railroad bridge.
1883 At noon on November 18, standard time is introduced to the nation by the railroads.
1887 The Interstate Commerce Act was passed by Congress providing the first federal regulation of railroads.
1893 New York Central locomotive No. 999 attains a record speed of 112.5 miles per hour near Batavia, NY.
1895 A Baltimore and Ohio trunk line in Baltimore was electrified making this the year of the first use of an electric locomotive in the United States.
1910 The CB&Q was the first railroad to operate and employ the printing telegraph in its rail operations.
1915 The CB&Q was the first railroad to use the train radio.
1917 The federal government seizes control of the railroads for the duration of World War I. By the time they are returned to private ownership in 1920, they are in seriously run down condition and in need of substantial maintenance and improvement.
1924 The first diesel locomotive suitable for use was built for the New York Central.
1927 Centralized traffic control was implemented by the CB&Q.
1900 40 Other modes of transportation grow from small beginnings to challenge rail dominance over freight and passenger transportation. By the eve of World War II, automobiles, large buses, trucks, planes and pipelines - supported by government subsidies and less burdened by regulation than railroads have become full fledged competitors to railroads.
1929 40 The Great Depression exacts a heavy toll on the railroad industry, forcing substantial segments of the industry into bankruptcy.
1934 The first successful modern, streamlined, all stainless-steel train, The Pioneer Zephyr, was delivered to the CB&Q Railroad Company in April. The cars of the streamliners weighed 30 percent less than those built of other materials, were stronger and safer, required less maintenance, and had a more attractive exterior.
1937 The Delaware & Hudson Railroad laid the first continuous welded rail, or ribbon rail, in the United States.
1941 45 Railroads remain under private control during World War II and move on average twice the monthly volume of both freight and passengers as during World War I.
1945 70 Railroads enter the post war era with a new sense of optimism that leads them to invest billions of dollars in new locomotives, freight equipment and passenger trains. That investment would see retirement of the last steam locomotive by the late 1950s. In spite of this modernization, the decline in rail market share that began before the war resumes.
1945 53 President Harry S Truman is the last "railroad President." His successors will rely mostly on planes and automobiles, using trains largely for campaign trips.
1954 Piggyback service (truck trailers carried on flatbed rail cars) is offered by several railroads.
1955 Intermodal freight the movement of containers and highway trailers by rail is reported as a separate category of freight for the first time. In that year, railroads moved 168,000 carloads of trailers and containers. Now railroads move more than 8 million trailers and containers annually.
1970 75 Burdened by regulation and faced with subsidized competition, nine Class I railroads, representing almost one quarter of the industry's trackage, file for bankruptcy protection.
1970 The Burlington Northern Railroad was formed as a merger of the Great Northern Railroad, the Northern Pacific Railroad, the Chicago, Burlington and Quincy Railroad, the Pacific Coast Railroad, and the Spokane, Portland and Seattle Railroad.
1971 The federal government creates Amtrak to take over money losing rail passenger service.
1972 The Illinois Central Gulf Railroad was formed as a merger of the Illinois Central Railroad and the Gulf, Mobile and Ohio Railroad.
1976 The Railroad Revitalization and Regulatory Reform Act creates the Consolidated Rail Corp. from six bankrupt Northeast railroads. It also included regulatory reforms that were supposed to make the regulatory system more responsive to changed circumstances.
1980 The Staggers Rail Act reduces the Interstate Commerce Commission's regulatory jurisdiction over railroads and sparks competition that stimulates advances in technology and a restructuring of the industry, including creation of hundreds of new shortline and regional railroads.
1980 The Seaboard System was formed as a merger of the Chessie System, the Seaboard Coast Line Railroad, the Louisville and Nashville Railroad, the Carolina, Clinchfield and Ohio Railroad, the Georgia Railroad, the Atlanta and West Point Railroad, and the Western Railway of Alabama.
1987 The Seaboard System was renamed the CSX Transportation System.
1987 After a federal investment of some $7 billion, Conrail is privatized in what - at that time - was the largest share offering in U.S. history as investors pay $1.65 billion to buy shares in the railroad.
1995 The Burlington Northern Santa Fe Railroad was formed as a merger of the Burlington Northern Railroad and the Atchison, Topeka and Santa Fe Railroad.
1996 After 108 years of existence, the Interstate Commerce Commission goes out of existence and is replaced by the Surface Transportation Board which assumes responsibility for remaining railroad economic regulation.
1996 Railroads move more freight than ever before - 1.36 trillion ton miles - and do it while at the same time setting records for the lowest employee injury and train accident rates in history.
1997 The Norfolk Southern Corporation and CSX Corporation agreed to acquire Conrail through a joint stock purchase. The Surface Transportation Board officially approved the acquisition and restructuring of Conrail on July 23, 1998. The approved merger plan restructured Conrail into a switching and terminal railroad that operates as an agent for its owners, Norfolk Southern and CSX, in the Shared Assets Areas of Northern New Jersey, Southern New Jersey/Philadelphia, and Detroit.
1998 The Canadian National Railway was acquired by the Illinois Central Gulf Railroad.
2000 AMTRAK starts high speed Acela service.
2001 Conrail was acquired jointly by the CSX Transportation System and the Norfolk Southern Railroad.