Month: March 2022

 

White explores the multi-faceted ways in which railroads in 19th century North America had an impact on expansion, society, economics and politics. Railroads were able to effectively integrate the western part of the continent by creating meaningful networks of transportation capable of mass transit and resettlement of these areas. Being able to interconnect a continent in such a way was a never seen before major advancement for the time and served as economic stimulus in the post-civil war period. White acknowledges the importance and success of the railroads, but he critiques its flaws and inefficiencies. 

What is particularly interesting is his critique of the collusion between these railroad companies and the government as well as the financiers who were at the very top of these hierarchies and who through mechanisms of greed, corruption and technicalities made money off these companies and eventually led them to fail. 

The collusion and interdependence between the railroads and the government is undeniable. The government incentivized the building of railroads through subsidies and the allocation of land to these companies. The collusion between big business and government created a culture in which interdependent influence peddling began to arise as a phenomenon in North American society, particularly in America. What is now called lobbying and an unfortunate fundamental part of American politics has significant roots from the railroads and business culture from the time, according to White. “Having helped both to corrupt and to transform the political system by creating the modern corporate lobby” (xxiv). 

What is also interesting is his scrutiny of the mismanagement at the very highest levels of the corporations. As with the influence peddling spoken of in the previous paragraph, a culture of accumulating wealth through corruption and speculation and even manipulation of markets began to form during this time. White says, “they employed rational managers” but that “financiers made money through subsidies, the sale of securities, insider companies…land speculation…” (xxviii). Wealth created through these means, according to him, began to have a significant presence during this time. Conducting business by not actually creating a good or providing a service is very much present in contemporary society, especially in the west, so it is interesting to read about his take on it. 

In essence, what is of particular interest to me in White’s readings are his descriptions of the beginnings of an American culture in which big business and government collude in what most believe to be unethical practices, especially lobbying, but that is to this day part of orthodoxy in American business and government. Furthermore, what is also present in contemporary America is the widespread wealth accumulation through means of market manipulation, speculation and other various technical methods. The massive amount of wealth that can be gained from not actually creating a product or offering a service is interesting, to say the least, when considering traditional economics and the way in which wealth is most often created. White’s readings are an interesting examination into its historical roots. 

In White’s reading, the author emphasizes the question, why were many railroads built at a time where there was no demand for them or little to no need for them? At a time where the nation was just starting to function without the control of Europe and the constitution was just starting to take action, innovators like Rockefeller and Carnegie took over railroads and steel. Since the Louisiana purchase, Americans have been trying to expand west. Before railroads, Americans’ form of transportation was by walking or by horse which took days and even weeks to cross. With the arrival of railroads the author describes it as the “Epitome of Modernity”, which defined the age even if it had some failures. White explains that although Railroads with Mexico and Canada became a source of national pride and national discontent which was important since they formed an international network that lined three countries it also received criticism since they were very expensive and the demand for it was not strong yet. Since railroads were originally a public/Private enterprise and then became a private corporation, Financing meant that they had to reach the government with heavy loans. This led to the government to attack while also protecting their workers in the name of the public good. Railroad also failed in the political system and image. Politicians used railroads in order to gain popularity in campaigns without realizing how expensive and counterproductive it can be. Many started to notice that railroads became corrupt and this influence was the start of the modern corporate lobby. Railroads also had social failures such as the production of an abundance of crops, cattle and natural resources beyond what the market can absorb. Production yielded great environmental and social harm and the nation was not prepared to handle it. White stated reasons as to why railroads were too ahead of their time but he also understood the great influence it will have on the United States and on the world.

Entrepreneur and Wage Earner

This chapter looked at two facets of the American economy in the 1860s. One part was manufacturing, and the other was labor.

In the 1860s, the country was changing with the building of railroads, telegraphs, and ocean-going steamships. It opened the way to manufacturing and mass production. In the 1860s, there were four major economic components: mining, agriculture, construction, and manufacturing. Mining was the most stable of the four components. Although mining was more reliable than manufacturing, manufacturing was dominated by the wealthy elite, leaving little room for the struggling entrepreneur.

“Furthermore, the entrepreneur’s market of the sixties was seldom local, but regional or national. They have even given adequate demand for his wares. The entrepreneur could not reach potential customers. He needed the intervention of transportation companies and jobbers who bought and moved wholesale lots of goods”. The up-and-coming entrepreneur did not stand a chance against the new manufacturing elite, their capital. “Their customer base was the established “old elite”  businessmen. They primarily engaged in commerce, shipping, finance, and real estate.”

This passage indicates that the rich are only getting richer. Most manufacturers were from old money—this old money financed many of the factories and manufacturing in cities like Chicago and Cleveland. The new elite wanted to be called capitalists, and they had labor disputes with whom they considered labor conflicts.

Wage Earner

The 1860s was a difficult time for labor relations and manufacturing. New York Times felt the need to investigate and survey why trade unions and strikes grew. So these labor conflicts were severe to the wage earners. This was the case of the big fish eating the smaller ones. The more prominent manufacturers took over the smaller companies. The relationship between business and labor was so low that it compared itself to slavery. “The only difference is that there is agriculture  in the field, landed proprietors were the masters and negroes were the slaves; while in the North manufacturers in the field, manufacturing capitalist threatens to become the masters and the white laborers who are to be the slaves.”

The 1860s was a time of flux. The country was changing from an agricultural economy to manufacturing. The gap was slowly closing. It was estimated that 3.7 Americans were agricultural wage earners located chiefly in the South. Industrial manual workers numbered just over 3.5 million employees.

Slavery was known as the free labor system, a polite way to say exploited.  This free labor system was no threat to paid labor in the North.   There was an idea that non-property owners were defined as waged slavery. This idea gained a symbol of widespread respect because it was believed that all wage earners should seek freedom. However, the manufacturers did not treat the workers with dignity, and low wage poor working conditions caused workers to strike.

Conclusion

The chapter entitled “Entrepreneur and Wage Earner ” describes America in 1860 by contrasting manufacturing development and the worker’s plight.  Manufacturing during this time was predominantly in Northern cities. Southern states remained agricultural-based. The South had the advantage of free labor. In the north, manufacturers treated their workers like slaves.  In conclusion, the wealthy received benefits that ordinary people could not get the tax breaks or funding to start companies.  These advantages were unfair and led to resentment by the commoner.

The introduction and expansion of the railroad was described as extremely rapid. This change not only occurred in America but Mexico and Canada as well. It was a massive modernization to connect America as travel which was conventional was extremely slow. The Author’s main arguments was that the development of the Railroad was extremely important to America but there was massive corruption and misuse of subsidies that ended with bankrupt corporations. While the railroad made travel faster there were massive financial errors that occurred which are not commonly brought to light. The reading added to my knowledge as the Railroads also came at the cost of the Indian people and gave rise to the modern corporate lobby which companies used to compete with one another. Who were the major players that benefited from the massive modernization effort and should more corporate laws be put in place to prevent abuses. Also were judges capable of being bribed and other officials for contracts. Does the free market economy suffer more from such interferences and restrictions and what determines the degree of free market economic freedom countries are willing to allow as there will always be those people who exploit it and use it for their own official gain. What interested me was how the use of the railroads sha[ped the war and how conflict seems to provide us with modern technology. With modern combat what are the conventional methods of Troop transport would it be mostly motorized vehicles and how are such large convoys fuel supported for large scale movement. Would they also make ford an easy target and how effective are railways today as they seem to be easily destroyed in conflict. It would appear that railways could also be used within your lines and heavily protected. I’m also interested in how railroads transport modern goods.

Reading: Richard White “Railroaded: Creative Destruction”

Arafat Khalil

The United States is one if the most technologically advanced nations in the world. To get to this point the United States had to go through several innovations throughout its history. One of the biggest innovations was the creation of the railroads. Railroads did many great things to help the United States grow. It made things such as trade and travel much easier, however the creation of the railroads also had its faults.

One negative that was caused by the creation of the railroads was the destruction it caused. Many natives were conquered and killed, while the Americans were expanding their territory. In the reading White says ” The railroads initial contribution to conquest and development was their transport of troops and their supplies. Native resistance to Mexican, Canadian and American state control persisted longest at from the railroads”(White 455). This quote shows that the railroads had a great impact in conquering native people and their land. Railroads allowed troops and supplies to be transported much quicker then before. Railroads also helped cause the decline of the Buffalo. Railroads made transporting animal hides to different regions much easier. This made hunting Buffalo even more popular. In the reading White says “The railroads proved instrumental in their demise by providing a means to get Buffalo hides to market in a region utterly lacking water transport. And, as a bonus, their own ex-workers and freighters provided Atleast part of the labor force necessary to hunt the animals” (White 463). This shows the impact the railroads had in the hunting of the Buffalo during this time.

The third negative that the creation of the railroads have caused is the rapid growth it caused around the world. Farmers and miners were producing a surplus of goods. Things such as silver had filled the market. This surplus made certain farms unnecessary. Buffalo were hunted and slaughtered at a rapid rate for their skin. Resources were being used up at a rapid rate.

The innovation of the railroads allowed society to grow at a rapid rate. Things such as trading and traveling became much easier, however railroads have also caused destruction. Railroads allowed transporting and trading animal hides to become much easier. This caused the hunting of wild Buffalo to increase and led to the decline of it’s population. Railroads also made it easier to attack and conquer native people. This form of capitalism was called creative destruction.

 

 

White in the reading describes the rapid settlement of the American midwest because of the railroad and its perception and impact. Moreover this rapid change in the Midwest reflects a growing idea of American exceptionalism that I have begun to notice in class. White starts off the chapter with a hypothetical “If a western Rip Van Winkle had fallen asleep in 1869 and awakened in 1896, he would not have recognized the lands that the railroads had touched. Bison had yielded to cattle; mountains had been blasted and bored.Great swaths of land that had once whispered grass now screamed corn and wheat.” (White 455) This hypothetical spin on the Rip Van Winkle story exemplifies just how rapid of a change occurred in a 30 year period and how people out the time would view it. 

 

Moreover from the accounts of Hesse-Wartegg who was a German traveler in America, we get a non-American view of the settlement of the west. “Built through a dry, treeless, unpeopled desert, the railroad now crosses an agricultural paradise. Civilization sweeps like a storm across the plains and smashes what will not bow down or give way before it.” Although this review may have been a bit biased as Hesse would be incentivized by the railroad to write good things about it, what Hesse chooses to praise about the railroad and its effects says alot about what the americans/railroads would have valued. Hesse describes the railroad’s effects as a storm of civilization that rips through everything without question. 

 

Both Wartegg account and Van Winkle use aggressive language that presents the railroad as a civilizing force that pushes through lands and peoples. Their accounts remind me of American Progress by John Gast  which is the quintessential representation of manifest destiny. Manifest destiny was enabled by the railroad and plays into the larger idea of American exceptionalism because it is rooted in ideas of divine right. The seeds of this have been planted since the first settlers and their city upon the hill and the ambitious egalitarian principles rooted in the constitution which strived to be better than England. Moreover the idea of conquering nature, grass to corn, buffalo to cattle, and the positive feedback by people of the time indicate the idea that Americans have the ability to change the world through their own ability, ie technology like railroads, selective breeding etc etc. 

In his excerpt “Introduction”, Richard Whites dives into the evolution of railroad corporations of the nineteenth century, their failures and successes, and how the people at the time held negative feelings towards these corporations. His belief is these transcontinental railroads of the 19^th century caused great political and social clashes that could have been avoided if it didn’t come into being at the time, but at the same time Richard White acknowledges how these transcontinental railroads shaped what it is today and it is the failures that led to today’s systems.

It’s these railroad connections that connected the East to the West, North to the South, creating plenty of business and investment opportunities for people to get rich, and the rich to get richer, but it came with more negatives than positive at the time according to White. The world at the time just wasn’t ready for such innovation and it also greatly harmed the environment. This is due to there being an excess of railroads, a lot that he saw as unnecessary, and were not efficiently built or controlled, this cost the corporations and the government more than they saw in profits. He saw it more of an “execution” fault, than a fault in the idea of a transcontinental railroad system itself.

White mention’s that Railroaded emphasizes finance capitalism and he states ­– “It was not “capital” that built the railroads but credit, and the capital was ultimately at risk in the railroads did not belong to the men who controlled them.” (pg. 5) At the same time he goes on to mention Thomas Scott, Henry Vallard and others who were entrepreneurs that helped the railroads to proceed by buying bonds. He then mentions that the market at the time was not set apart from particular state policies, institutions, or social and cultural practices.

Perhaps my favourite part of his introduction is “…although many readers will find such a claim astonishing. It is about the utter uprooting of older ways of life and older ways of communication and travel by a new technology in the hands of new men with a new form of corporate organization.” (pg. 5) He believed that the investments that fed these “new technologies” would have been better spent on other more “current” issues, and not let technological advancement try to get ahead of its time, but looking at it from a view of the world two centuries later from when they were built, those technological advancements were necessary and it is for them that we have this part of the world shaped and as connected as it is today.

Richard White’s excerpt “Creative Destruction” brings up the various pros and cons of transcontinental railroads. To say the creation and rise of railroads in the United States brought with it many negatives is an extreme thing to utter, in hindsight. However, White does attempt to make the argument by mentioning how unnecessary a large agricultural expansion was needed. While the railroads did create extremely productive farmlands, it created as many, if not more, extremely unproductive and costly farmlands. These railroads also made farmers overproduce goods like cattle, wheat, and silver. The level of supply of these goods easily surpassed the world demand for the goods meaning a great loss of money, time, effort, and product for eager farmers and their farmland communities.

White also touches on how certain people with money, influence, and/or power were able to take advantage of these transcontinental railroads while the majority of the population had to wait a while to enjoy this movement. Entrepreneur Joseph Schumpeter famously said “creative destruction was its essence” when referring to capitalism. He believed that the harm and the damage capitalism was able to create was the reason why capitalism was so powerful. For someone like him to claim this makes complete sense. He reaped way more than he sowed because he had the goal of getting wealthy quick, now, and in a hurry. Schumpeter, however, did not keep that same energy when it came to the rest of society who weren’t apart of the elite. He often spoke about how it’ll take generations for communities to finally enjoy the fruits of their parent’s labor and Schumpeter was completely okay with that. In fact, he encouraged it.  The entrepreneur believed that society should let capitalistic damage, in this case the creation of railroads, run its course. Eventually with time the problems brought about from these creations would sort themselves out. This reminds me of the idea of Adam Smith’s Laissez Faire. This idea promoted minimal government intervention because of the belief that markets, if left alone, would solve their issues on their own over time. It is not surprising that Joseph Schumpeter openly agreed to all this. He had to actually. Reason being is because if his goal was to get rich quick, he needed a lot of people to suffer and not prosper so that he had the opportunity to thrive.

One surprising fact that I read in this excerpt was how underwhelming growth was in the West initially but then boomed almost immediately due to the railroads. One would think that with the implementation of a society-changing innovation like the railroad  would instantly produce prosperity. However, very quickly did the United States realize that the lands between the 98th and 100th meridian were very infertile, very dry, and overall not good enough land to cultivate goods. This being the case in the midwest and west, California was upset about how small their growth was occurring in the 1870s and 1880s. In fact, between the years 1880 and 1890, the Sacramento Valley “had lost 20 thousand of its natural increase in population”. However, very quickly would all this change. So in the 1870s there were only 2 million non-Indians settled west of the Missouri River. By 1900, that 2 million had multiplied 5-fold to a whopping 10.4 million. This fact fascinates. It’s crazy to think how quickly things could change seemingly just out of the blue.

White’s book describes the various transcontinental railroads that were established in America. In chapter eleven of his book, “Railroaded,” White describes the historical transformation that arises as a result of the establishment of transcontinental railroads. Railroads are viewed as an engine of change. Some of the changes include conversion of land that was
initially bare being utilized to plant wheat and corn, increased population, the growth of cities (White 455). This change occurred rapidly and came as a result of the establishment of railroads. The establishment of railroads negatively affected the Indian people negatively as they were displaced, controlled, confined, and others were murdered during the struggle to protect their land from being taken from them.

I acquired so much from this reading that I was not aware of before. One is that there had been debate on whether the growth was entirely from railroad establishment. The Missouri and Burlington directors once told their stockholders that the railroad should not get total credit for the settlement increase (White 457). Preemption and homestead laws had also contributed to the increased settlement. However, there would be no occupants settling in the land bordered railway tracks in the absence of railroads.

One question that crosses my mind is how the planners organized where the railroads were to pass through. I also wonder whether the transcontinental was worth the cost. The author notes that poverty also increased in the process of progress. The author addresses my questions as he states that there were better locations where the railroads would have been established. For instance, if the rail lines connected St. Louis, Kansas City, and Chicago to the east would have connected California to a perfect Pacific rail (White 461). Railroads created environmental catastrophes and dumb growth when it comes to the cost. The establishment had incurred high costs, which resulted in the railroads not being willing to wait for profitable traffic to arrive (White 462). Items would be hauled at a loss as the railroads had been established before demand existed. I am curious whether people realized the adverse effects they were encountering as a result of the establishment of railroads.

“Say what you will, the result was worth the price, and the lives of tens of millions of people were the better for it.” This is the ideology many used to defend what was becoming of the United States. When it comes to the 19th century development the implementation of railroads into the US economy is one of the most notable ones mentioned as it allowed for 3 seperate countries to unite at the time. The initial thoughts brought about from the implementation of the railroad systems were that they were soon to be a symbol of progress for civilizations and the nation as a whole. What was not considered at the time and what Richard White argues is whether it was even necessary to create this system of railroads at the time as there was not much need for it. The incorporations of railroads led to a huge undertaking of mass constructions of these railroads that was subsidized by the government. This expansion came at a price and it is not taken into much account as it is seen more so as a side though to many entrepreneurs who were trying to get many to incorporate railroads into small towns to incentivize them to join the railroad economy. What White notes is that this expansion with the use of railroads did what two generations couldn’t do in half the time. 

There is no doubt that there was success in this implantation of railroads but what is not highlighted enough and what continues to be Whites argument is if it was necessary at the time. What I find interesting is the idea that this is the first time that American industrialism has been criticized for the time it was implemented rather than if it was a good or bad. Rather than criticizing how the implantations of railroads brought economic instability White approaches the topic as to if it was at the right time in history to incorporate the system to the United States. The mention of creative destruction also comes into the mix as when seeing how railroads took out the majority of the Indian population and how it was necessary for the country as a whole to succeed. What is later discussed is the social benefits and how there were only positives mentioned while there were a lot of negatives to also consider when discussing railroad implementation. White acknowledges Hornaday’s statement that “Americans would never appreciate anything that could not be assigned to a large market value”, needless to say this was true this also meant that there were environmental catastrophes that would ensue and not be stopped until the process was too late to reverse the effects. So with the introduction of the railroads rather than being seen as this huge asset to the United States white takes a different approach and criticizes how there was more loss than good that railroads brought into the country.