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Part III: Beginning of the Railroad Age: To 1861
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PART III BEGINNING OF TIlE RAILROAD AGE: TO 1861 [54.89.24.147] Project MUSE (2024-03-29 01:22 GMT) C A~AL-D!GGr"G had scarcely begun in Ohio when the first agitation for railroads commenced. Experiments in Great Britain had aroused a lively interest On this side of the Atlantic in the railroad as an alternative to canals. and by the early 1830's several cities in the East--notably Baltimore and Charlestonwere actively developing major railroad projects. Even so, when Ohio moved to expand its public works in the mid-thirties, the state once again restricted its outright public enterprise to canals; and though the 1837 Loan Law pennitted investment of state funds in railroad companies, the construction of railways was left to the private sector. Why policy-makers in Ohio eschewed a policy of public railroad construction. and why they encouraged private railroad construction even when it threatened the commerce and revenues of the state canals~ comprise an important theme in the following pages. To understand how Ohio had by 1860 acquired more railroad mileage within its borders than any other American state, it is essential to recognize at the outset One feature of the process: while there were, to be sure, shifts of initiative (from the public to private seclors) and of technology (from canals to steam railroads ), there was basic continuity in some of the political forces that shaped state policy. In Ohio there was a society infused with the spirit of the expectant capitalist, impatient with restraints and obstacles that stood in the way of rapid economic growth; and it was a society whose political life, when it carne to settling matters of public economic policy, was organized largely around OHIO CANAL ERA localistic interests, In the 1820'S and 1830'S, the people had adduced commonwealth principles and egalitarian ideals to justify state government investments in transportation, In later years the popular conception of "commonwealth" would be modified severely under pressure from localistic and entrepreneurial ambitions ; and the active state as it had functioned eariier would fall into disrepute, But although the state's public policy toward railroad enterprise was largely permissive and gave free play to private investment as the means of pursuing localistic aims, appeals were still made to commonwealth interests, :Kot only did promoters demand public financial aid for their railways, but they argued for liberal charters and general laws in order to attract to Ohio investment which, they claimed, would otherwise go to other states; and they justified special immunities and privileges on the grounds that such concessions were in the interest of the commonwealth , Indeed, the entire development of railroads in Ohio reflected the effeets of public policy, When a group of promoters-with or without sufficient capital to back up its dreams-planned a railroad, its first task waS to obtain a charter from the legislature, Once a charter was in hand, the costs that the company would incur in obtaining a right-of-way, the taxes it must pay (or be exempt from paying), and a wide range of other factors affecting the profitability of the investment werc greatly influenced by the structure of law, And if the company was at all typical, it sought by every means possible to obtain financial aid from public authorities-aid that often meant the difference between success and failure in building the line. Once railroads were built, the wider economic effects were similar to the impact of the canals in an earlier period, Above all, the railroads significantly Changed the position of Ohio's agricultural and industrial produccrs in the national market, subjecting some to damaging dislocation and opening for others a wider and more profitable market In some regions of the state they fostered growth; elsewhere, they seriously injured existing local interests, As had been true of the canals, some of the early dreams of the promoters were realized in full measure, while others proved illusory, [54.89.24.147] Project MUSE (2024-03-29 01:22 GMT) Begiflning oj/he Railroad Age ( '73 Part of the price exacted by the shift from public canals to private railroads was loss 01 trade on the public works. The manner in which railroad competition with canals developed, and the response of the state legislature and Ohio's administrative agencies to the threat of railway competition, provide evidence vital to an understanding of changing conceptions 01 the state's legitimate ro!~ in the economy. ...