How were railroads corrupt?

Railroads Were at the Forefront of Political Corruption “Railroads need monopoly franchises and subsidies, and to get them, they are more than willing to bribe public officials,” White says. The Central Pacific Railroad, for example, spent $500,000 annually in thinly disguised bribes between 1875 and 1885.



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Crédit Mobilier Scandal, in U.S. history, illegal manipulation of contracts by a construction and finance company associated with the building of the Union Pacific Railroad (1865–69); the incident established Crédit Mobilier of America as a symbol of post-Civil War corruption.

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Common knowledge has it that the transcontinental railroad was very much a product of its times – another Gilded Age monument to corruption, embezzlement, and the unjust enrichment of capitalists.

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On September 4, 1872, the Sun broke the story. The newspaper reported that Crédit Mobilier had received $72 million in contracts for building a railroad worth only $53 million. After the revelations, the Union Pacific and other investors were left nearly bankrupt.

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But there was also a dark side to the historic national project. The railroad was completed by the sweat and muscle of exploited labor, it wiped out populations of buffalo, which had been essential to Indigenous communities, and it extended over land that had been unlawfully seized from tribal nations.

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Abstract. In this chapter, we review the level of disturbance caused by railways due to noise and vibration, air, soil and water pollution, and soil erosion.

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What wrongdoing were railroads guilty of? Stock watering (which enabled railroad stock promoters to inflate their claims about a given line's assets and profitability and sell stocks and bonds in excess of the railroad's actual value) as well as other corruption such as bribery.

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Jay Gould Infamous for manipulating stock, Jay Gould was the most notoriously corrupt railroad owner. He became involved in the budding railroad industry in New York during the Civil War, and in 1867 became a director of the Erie Railroad.

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For others, however, the Transcontinental Railroad undermined the sovereignty of Native nations and threatened to destroy Indigenous communities and their cultures as the railroad expanded into territories inhabited by Native Americans.

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The railroad is credited, for instance, with helping to open the West to migration and with expanding the American economy. It is blamed for the near eradication of the Native Americans of the Great Plains, the decimation of the buffalo and the exploitation of Chinese railroad workers.

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They had to face dangerous work conditions – accidental explosions, snow and rock avalanches, which killed hundreds of workers, not to mention frigid weather.

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Laying track and living in and among the railroad construction camps was often very difficult. Railroad construction crews were not only subjected to extreme weather conditions, they had to lay tracks across and through many natural geographical features, including rivers, canyons, mountains, and desert.

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Gandy dancer is a slang term used for early railroad workers in the United States, more formally referred to as section hands, who laid and maintained railroad tracks in the years before the work was done by machines.

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Shipping and railroad tycoon Cornelius Vanderbilt (1794-1877) was a self-made multi-millionaire who became one of the wealthiest Americans of the 19th century.

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Once some railroad owners consolidated, combined, they gave secret rebates, or discounts to their “better” customers in an attempt to keep them in business with the railroad. This hurt many small businesses that could not compete.

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Monopolies as unfairly subsidized Railroads had the ability to condemn land to build their routes. They got subsidies of land, loans, bonds and other financial aid from federal, state and local governments. Their political contributions and favors secured them supporters in legislatures, Congress and the courts.

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The root of the railroads' trouble is that they were ordered to spend more in increased wages than they were able to earn from increased rates. Consequently, net income for 1920 well-nigh disappeared.

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