entury almost as great as
that of the railroad itself. The Mississippi River was the great natural
highway for the products and the passenger traffic of the South Central
States; it had made New Orleans one of the largest and most flourishing
cities in the country; and certainly the rich cotton planter of the
fifties would have smiled at any suggestion that the "floating palaces"
which plied this mighty stream would ever surrender their preeminence to
the rusty and struggling railroads which wound along its banks.

This period, which may be taken as the first in American railroad
development, ended about the middle of the century. It was an age of
great progress but not of absolutely assured success. A few lines
earned handsome profits, but in the main the railroad business was not
favorably regarded and railroad investments everywhere were held in
suspicion. The condition that prevailed in many railroads is illustrated
by the fact that the directors of the Michigan and Southern, when
they held their annual meeting in 1853, had to borrow chairs from an
adjoining office as the sheriff had walked away with their own for debt.
Even a railroad with such a territory as the Hudson River Valley,
and extending from New York to Albany existed in a state of chronic
dilapidation; and the New York and Harlem, which had an entrance into
New York City as an asset of incalculable value, was looked upon merely
as a vehicle for Wall Street speculation.

Meanwhile the increasing traffic in farm products, mules, and cattle
from the Northwest to the plantations of the South created a demand for
more ample transportation facilities. In the decade before the Civil
War various north and south lines of railway were projected and some of
these were assisted by grants of land from the Federal Government. The
first of these, the Illinois Central, received a huge land-grant in 1850
and ultimately reached the Gulf at Mobile by connecting with the Mobile
and Ohio Railroad which had also been assisted by Federal grants.
But the panic of 1857, followed by the Civil War, halted all railroad
enterprises. In the year 1856 some 3600 miles of railroad had been
constructed; in 1865 only 700 were laid down. The Southern railroads
were prostrated by the war and north and south lines lost all but local
traffic.

After the war a brisk recovery began and brought to the fore the first
of the great railroad magnates and the shrewdest business genius of the
day,