Breaking the Myth About America’s ‘Great’ Railroad Expansion

Politicians love a good historical analogy. That’s why Joe Biden has compared his infrastructure law to the construction of the interstate highway system and the transcontinental railroad. The president, of course, means such comparisons in a flattering light. For those who have studied these revolutionary policy choices, however, the consequences are not so unblemished.

Ten years ago, historian Richard White catalogued the greed and ineptitude of railroad executives and the policymakers who blindly enabled their schemes. In Railroaded: The Transcontinentals and the Making of Modern America, he explored the history of corporations that have gone down in American myth as corrupt but ultimately productive and necessary.

White argues that the transcontinental railroad companies were not necessary for stitching the young country together; they were simply an example of “dumb growth” that hurt more than it helped. Sped along by state subsidy and paid-for politicians, these corporations built in places where there were no markets. They never made money. The entire enterprise was a vast Ponzi scheme, and its periodic turmoil threw the nation into repeated economic crisis. Their selfish flailing scourged wildlife, oppressed Native Americans, and spread new settlements to areas where they could not be sustained (and after long suffering were not).

Instead of an all-powerful “octopus” engulfing the country, he saw the railroad men as a collection of myopic and unintelligent executives who could not have survived year to year without government subsidy. Instead of a monstrous kraken, he suggested a better analogy would be “a group of fat men in an Octopus suit fighting over the controls” of a train going off the rails.

Governing talked to White on the 10th anniversary of Railroaded about the common mistakes we make in debating infrastructure, the dangers of historical analogy, and backlash to myth-busting the preferred national narrative.

Governing: In Railroaded you argue that the great transcontinental railroads were not the embodiments of rough-and-tumble frontier capitalism we learn about, but wasteful, heedless entities that survived only by corruptly securing financial backing from the public. Why does the myth of the railroad generation as a time of corrupt, but fruitful, corporate growth persist?

Richard White: It’s such a useful myth. Barack Obama used to cite it around high-speed rail. I admire Obama for a great many things, but his knowledge of American history in the 19th century took a blow with that one. But I think for his purposes, he couldn’t care less about what the railroads were actually like. What he wants to do is say, “look, we did this once and we can do it again.”

You hear this over and over again. David Brooks says it all the time. Once we were a nation of builders, but now we can’t get anything done. The story of the railroads is a very useful, encapsulated myth for that kind of statement. That’s why they use it. It’s not about what actually happened in American history. It’s a justification for policies they want to pursue.

Governing: The alternative to the transcontinental railroads as they existed was not a lack of progress, or a West without trains. The question instead was whether they should have been subsidized to grow in the way that they did. How might railroad networks and America’s westward development have unfolded if they did not enjoy such government largesse?

White: What would have happened is what, in fact, happened in California. Even though the transcontinentals [reach the West Coast] in 1869, there’s hardly any traffic going across the country. Instead, there is a market on the West Coast so what you get is railroads built in California that feed into San Francisco Bay. Things are put on railroad trains that go into San Francisco Bay. Then they are put on ships and shipped west across the Pacific, or more likely down to Panama. What you have is a hybrid system where the railroads feed the ports. That’s how things operate really until the 1880s, 1890s.

Meanwhile, they build not only those first transcontinentals but all these others and they inevitably go bankrupt. They’re subsidized railroads which do not have traffic and with their attempts to develop traffic, they’re disastrous for Native American people and disasters for the environment. They largely fail.

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Politicians love a good historical analogy. That’s why Joe Biden has compared his infrastructure law to the construction of the interstate highway system and the transcontinental railroad. The president, of course, means such comparisons in a flattering light. For those who have studied these revolutionary policy choices, however, the consequences are not so unblemished. Ten…

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