Ch.6 section 2

National Network Made westward expansion possible Government gave railroads huge land grants to expand Romance and Reality Dreams of cheap land, adventure, and a fresh start Central Pacific employed Chinese Union Pacific hired Irish and Civil War veterans Accidents, diseases, and Indian attacks killed thousands each year Railroad Time Professor C.F. Dowd proposed time zones Nov. 16, 1883, watches were synchronized to the time zones

New Towns and markets Oil, coal, steel, lumber, and glass industries grew Previously isolated cities and towns were linked Cities began to specialize in particular products George M. Pullman Manufactured mostly sleeper cars Built a town for his workers which remained under company control No loitering on their own porches or drinking alcohol A violent strike broke out when Pullman lowered wages but not rents

Credit Mobilier Construction company formed by Union Pacific stockholders Stockholders gave the company a contract to lay track at two to three times the actual price and pocketed the rest. Shares were donated to 20 members of Congress in 1867 Vice president Schuyler Colfax and Congressman James Garfield (Republicans) both accepted shares. All public figures were allowed to keep their profits

Railroad Abuses Fixed prices which kept farmers in debt Demanded more money for short hauls when there was no competition Charged different customers different rates Granger laws Passed in the West, Midwest, and Southeast to establish maximum rates and prohibit discrimination Munn v. Illinois (1887) the railroads challenged the Granger laws in the Supreme Court and lost Established the right of the federal government to regulate private industry

Interstate Commerce Act (1887) Established the right of the federal government to supervise railroad activities Interstate Commerce Commission Didn’t gain power to be effective until 1906 Panic and Consolidation Caused by corporate abuses, mismanagement, overbuilding, and competition worst financial depression up to that time 600 banks, 15,000 businesses, and 4 million people Large investors came in and bought up all the failing railroads