Nothing Like It in the World The Men Who Built the Transcontinental Railroad 1863-1869 (52 page)

Twice a day the camp train moved to the end of track—at noon, to give all hands a hot dinner, and at night, to give supper and sleeping accommodations. Through the telegraph (there was a battery on his car and an operator to work it), Strobridge would order his supplies for the next day. “Thus hand in hand on their sturdy march,” the reporter wrote, “go the twin giants, the railroad and the telegraph, linked mailed purveyors of civilization which is ere long to wrest from its pristine wilderness a continent.”

Altogether, it was a great modern army, moving forward with a will and a plan, unable to stop, determined to win the battle.
34

O
N
November 13, Huntington wrote Stanford, in Salt Lake City, “If it is within the power of God, man, or the devil to get out rail laid to within
300 miles of Echo by, say the tenth of December, it should be done.”
35
Echo was four hundred miles away. To get to within three hundred miles would require more than three miles per day in the month of track laying still ahead, a record beyond any previous accomplishment of the CP.

Stanford was much more interested in getting the Mormons to build west from Ogden in order to connect with Crocker's graders moving east. He was sending Benson, Farr & West crews up to Promontory to “take possession.” He wrote Huntington on November 21 that the UP was retreating, because Durant also wanted to get control of Promontory and had therefore ordered UP men to come off the work at Humboldt Wells to work at Promontory.

Plus which, Stanford pointed out, the UP “have the grading substantially done from the mouth of Weber [eastward] to their track,” which was just short of Echo. They had built the grade and laid the tracks on the exact line Huntington had handed in to the Interior Department on his maps. So the CP had nothing to complain of, and it was hopeless to try to build all the way to Echo. In any event, the UP was “making desperate efforts to get into Echo before the winter storms and cold shall shut them out.”
36

At the end of November, Stanford and Lewis Clement went to Promontory, where they spent several days looking around. Stanford had earlier decided that the line laid out by the CP surveyors would not do, because it required a tunnel of eight hundred feet through solid limestone. On this occasion he and Clement decided to lay out a new line, “somewhat at the expense of the alignment,” but it would eliminate the tunnel and thus save $75,000. The new line would also require a fill of about ten thousand yards.

Stanford also noted that the UP had surveyed a line that ran very close to the CP line, often within a hundred feet. Neither company had yet built a grade over Promontory. On December 4, he wrote E. B. Crocker: “Clem [Lewis Clement] has sent me a profile of the line at Promontory avoiding the tunnel and it looks better than I expected. During the next week the Mormon contractors say that they will have the whole work covered from Ogden to Monument Pt.” That is, they would have graders at work on it. “Then, if I have the right of way secured, I shall assert our line to be the only one of the Pacific RR and that others must keep off our right of way.”

That last remained to be seen. So too the hope Stanford expressed at the end of his letter: “I have strong faith in our being first to the mouth of Weber. I do think there is ground for hope.” Four days later he ended another
letter, “Could not Charley, by staying out on the track, push forward faster?” But there were other worries, to the west of Promontory. Stanford said, “At Humboldt Wells I think the true policy is to follow our own line disregarding entirely what the UP has done there, using their grade or not just as our line may make it necessary.”

With regard to Huntington's hope to reach Echo, Stanford thought it “such utter folly in every way” that it had to be disregarded. The UP was already there.
37
Huntington, knowing Stanford's objections, told Hopkins in a December 15, 1868, letter, “I think it a terrible mistake that we have made in letting matters run as they have at Salt Lake”—that is, with Stanford in charge. “I sometimes swear terribly about it, but that doesn't do any good.”
38

I
N
1868, the CP had constructed 362 miles of road. That was virtually the mile per day that Charles Crocker had promised. Both lines were about to enter Utah. There they had completed as much as two-thirds of the grading, but still had track to lay and more grades to make. In Utah was by far the biggest city between Omaha and Sacramento, Salt Lake City. Up to that time, the westward-building UP and the eastward-building CP had been going into a land nearly without people. The roads had been setting a precedent. Instead of building a railroad that would connect one town or city with another, they had been building into a void. They were not striving to take over trade routes; instead they hoped to attract settlement.

The UP and the CP had a lot at stake in Utah. Government bonds, land grants, the sale of their own stocks and bonds, future trade, and more. But what mattered most was winning. Far more so than gamblers, card players, athletes wrestling or boxing or running or playing games, brokers dealing in stocks and bonds, lawyers trying a case, bankers making or calling a loan, whoever else or whatever other competitors, the directors, superintendents, surveyors, engineers, foremen, grade makers, rail layers, ballast men, cooks, telegraph builders and operators, and everyone one else connected to the road wanted to win. In fact, they were all desperate to win and would do whatever winning required. And the final act would be played out in Utah.

*
Actually, it eventually came true: Winnemucca went into the twenty-first century a thriving town.

*
The run meant rapidly rising revenues for the line. By the end of 1868, Mark Hopkins found that the CP had its biggest net profit ever, more than $1,250,000.

*
Not true, but close enough for the nineteenth century.

D
OC
Durant had spent far too much money to get through Nebraska and Wyoming fast, and had promised even more to Brigham Young and the Mormons to beat the CP through Utah. It was not possible for the company to sell enough stocks and bonds, or to collect enough loans in the form of 6 percent bonds from the government, even to come close to paying its due bills. It had no hope of paying off longer-term debts. The company owed around $10 million. Meanwhile, in December 1868, the Crédit Mobilier had paid a huge dividend to its stockholders. It amounted to nearly $3 million, which brought the total paid out in 1868 to $12.8 million in cash, plus over $4 million in UP stock (at par value of $100 per share), bringing the total of stock distributed since 1867 to $28.8 million.
1

To Brigham Young, this was outrageous. Beginning in January and continuing through the year, he would dun Doc to pay up. “I have expended all my available funds in forwarding the work,” he wrote on January 16. If he could he would continue to do so, but he was out of funds. “These explanations must be my apology for troubling you in the matter.”
2
More followed, with supporting details. “The men are very clamorous for their pay,” Young informed Durant. There was some three-quarters of a million dollars yet due them. They had done and were doing the work and “have now waited from half to three quarters of a year for their pay.” Six months later, Young was still trying. “To say the least,” he declared in one letter, “it is strange treatment of my account after the exertions made to put the grading through for the Company, It is not for myself that I urge, but for the thousands that have done the work,” One UP official told Young, “It is a good thing for us that your people did the work, for no others would have waited so long without disturbance.” Young quoted this back to the UP, but still—this was in November 1869!—couldn't get paid.
3

A
corporation that pays nearly 300 percent cash in dividends on invested capital in just one year but cannot pay what is owed to its workers is in big trouble. For the UP and its construction company, the Crédit Mobilier, the trouble was bigger than big. In January 1869, the respected
North American Review
printed an article by Charles Francis Adams, Jr. Adams was a member of the Massachusetts Board of Railroad Commissioners and a grandson and great-grandson of U.S. presidents. The article was entitled “The Pacific Railroad Ring.”

Adams's target was the Crédit Mobilier. He called it “but another name for the Pacific Railroad ring.” He charged that “the members of it are in Congress; they are trustees for the bondholders; they are directors; they are stockholders; they are contractors; in Washington they vote the subsidies, in New York they receive them, upon the plains they expend them, and in the ‘Crédit Mobilier' they divide them.”

Adams described them as “ever-shifting characters” and charged “they are ever ubiquitous; they receive money into one hand as a corporation and pay it into the other as a contractor…. Under one name or another, a ring of a few persons is struck at whatever point the Union Pacific is approached.”
4

At that time, Adams's “ring” was bigger than his phrase “a few persons” implied. The stockholders consisted of ninety-one individuals, only seven of whom were in Congress (including Grenville Dodge and Oakes Ames).
5
But that didn't matter. What did matter was that the money that flowed from the Union Pacific into the Crédit Mobilier and what was done with it—which wasn't to pay the contractors, the subcontractors, or the laborers who had gotten the railroad from Omaha to the Utah border—was further enriching a relatively few already wealthy men who milked the corporation, the government, and ultimately the people for their fat and ill-gotten profits. “Greedy interests are stimulated into existence,”
according to Adams, and they “intrigue and combine and coalesce, until a system of political ‘rings,' legislative ‘log-rolling,' and organized ‘lobbies' results; and then, at last, the evil becoming intolerable, the community sluggishly grapples with it in a struggle for self-preservation.”
6

Or so at least Adams wrote. In the process he was preparing the ground for the planting of a seed that might someday sprout and could then grow into the largest scandal in nineteenth-century American history. He was pointing the way and providing the means for politicians, some of them venal, others upright and genuinely and rightly concerned, to go after the Crédit Mobilier, potentially to ruin the shareholders and perhaps the UP itself.

Which was only fair. It was democracy that had made the UP possible. If the company was to be attacked without mercy, even after it built more than half of the road that everyone wanted, it was fitting that the representatives elected in the democratic system do it.

By no means was it just Adams who went after the UP. As its moment of triumph approached, there were many others ready to launch an assault.

T
HE
CP had its own severe problems. Money, of course. Huntington could never sell enough of the company's own stocks and bonds, or gather in enough of the government bonds for grading and tracking, to pay the bills. Questions abounded. Would the company's rails get to Ogden before the UP? Could they go east from Ogden up the Weber River Canyon? Up Echo Canyon? More realistically, could the CP rails reach Promontory before the UP? How much of the grade the company had built and was building in Utah would it be able to use?

The corporation was also vulnerable to the kind of charges Adams had brought against the UP. Charlie Crocker's Contract and Finance Company was like the Crédit Mobilier in so many way that the firms were like two peas in a pod, except that the Big Four plus E. B. Crocker held all the stock of the Contract and Finance Company secretly. As to Adams's implication that the UP had been involved in bribery (how else to explain why so many congressmen held Crédit Mobilier stock?), the CP could hardly stand a close examination of Huntington's accounts.

Huntington had been in Washington with large sums of money at his disposal whenever Congress took up a question in which his railroad had
a consuming interest. He had left Washington considerably lighter in his pocket, but with a favorable vote. An investigation of the UP's finances would only help the CP. But what if the politicians, having gotten into the matter, decided to broaden the inquiry to include the CP?

T
HE
two corporations shared other problems. One was material. On January 1, 1869, the CP had thirty-five ships bound for San Francisco. They were bringing essential construction materials, including eighteen locomotives. As the
Salt Lake Daily Reporter
noted, “There is not a rail on the CP line of the road that has not been brought a distance of six thousand miles.”
7
In Truckee, the sawmills worked around the clock to meet the CP's orders for a million ties. In Omaha, UP ties were piled up in the yards, awaiting shipment. One of Casement's orders for ties alone required hauling six hundred flatcars a distance of four hundred miles. Even after the ties were delivered along the grade, it took six or more carloads to supply enough material to lay one mile of track.