In 1871, Kentucky Congressman J. Proctor Knott gave a humorous speech on the floor of the House of Representatives ridiculing the idea of giving land grants to western railroads. He focused on Duluth, which at the time had about 3,000 residents, and his basic argument was that U.S. taxpayers in general should not be required to subsidize projects that benefitted only a few.
The speech was widely reprinted by those skeptical of government pork barrel (a term that first became popular about the time Knott gave his speech). Sixteen years later, Northern Pacific, which received what was probably the largest land grant to a private company in American history, reprinted the speech in this brochure.
This might seem strange except that NP annotated the speech with recent facts in bright red letters, such as that Duluth had grown to house 26,000 people by 1886, that more wheat was delivered to Duluth each year than to any other American city, and that it also saw deliveries of millions of board feet of lumber and hundreds of thousands of tons of iron ore each year.
NP didn’t say so in so many words, but its point was clearly that the land grants, contrary to Knott’s predictions, were a good thing for most if not all Americans. However, the brochure also didn’t mention that James J. Hill was proving that a railroad that didn’t receive any land grants or subsidies could provide just as many benefits without going bankrupt, which would leave both investors and taxpayers in the lurch. (The St. Paul & Pacific did receive a small land grant, but Hill paid fair market value for that railroad and land after it went bankrupt, thus Hill didn’t particularly benefit from the subsidy.)
Train Lover (Randal O’Toole), “Debate Over Railroad Land Grants”, Streamliner Memories, 2022-11-01.
February 6, 2023
QotD: US railroad land grants
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