. Cost, capitalization and estimated value of American railways; an analysis of current fallacies . Pacific Railroad, for which groundwas broken in 1870, boasted that it was going into a territorythat would make ten States as large as Pennsylvania, whollyunsupplied with railroads. In the language of Poors Manual,speaking of one western road, Nearly the whole increase ofmileage has proved unproductive. This was true of all otherwestern railroads. It was simply a case of excess of mileageto population. The country was railroad mad, and then, asever, speculative promoters took advantage of the fe
. Cost, capitalization and estimated value of American railways; an analysis of current fallacies . Pacific Railroad, for which groundwas broken in 1870, boasted that it was going into a territorythat would make ten States as large as Pennsylvania, whollyunsupplied with railroads. In the language of Poors Manual,speaking of one western road, Nearly the whole increase ofmileage has proved unproductive. This was true of all otherwestern railroads. It was simply a case of excess of mileageto population. The country was railroad mad, and then, asever, speculative promoters took advantage of the fever toproject lines into territory which could not be expected to sup-port them for another decade. Then came the granger legisla-tion in the same western states, which frightened capital andeffectually put an end to railway expansion, until, with its modi-fication or repeal by 1878, there came restored confidence andrenewed activity in building into the wilderness, soon to bepeopled with millions brought thither by the railways whichlooked to the future to recompense them for what were origi-. Monster of 1876 (3 ft. 6 in. Gauge) and a Modern Locomotive, nally unprofitable optimistic ventures. How the financial andindustrial panic of 1873 affected the railways is shown in thereceiverships during the following years, a summary of which 85 is given elsewhere (page 154*. Its effect upon the cost ofthe railways is reflected in the advance from a cost of $44,000per mile in 1870 to $56,000. While the panic and liquidation wiped out millions of dollars of investments, it simply createdthe necessity oi raising other millions to restore many roadswhich were permitted to run down and to bring- others up tothe higher standard required by our increasing population andexpanding trade. Roadbed, bridges, rails, equipment and ter-minal facilities had to undergo a complete transformation tomeet the demands of a freight traffic that more than doubledin ten years. Between 1870 and 1880 the mileag
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