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Show 374 HISTORY OF PUBLIC LAND LAW DEVELOPMENT the grant. There was opposition in Congress to allowing the grant to fall into the hands of the local company and the bill was framed to exclude that possibility. Between the actual passage of the measure and its publication, however, two words were changed, thereby reversing the intention of Congress. There followed a great outcry and an investigation to determine who had made the changes. Not getting any satisfaction, Congress angrily repealed the land grant. Even more extraordinary was the fact that Congress had made a grant to a territory, which, as Donaldson says, "is not a sovereignty."91 The failure of the promoters to win a Wisconsin grant for a line to Superior, together with the Panic of 1857, ended their hopes for the city. Shares in the company which had risen as high as $100,000 and lots in the city, once held for $2,000, now could find no takers.92 It took Superior long years to recover. When a transcontinental was chartered to be built from Lake Superior, its eastern terminus was not at Superior but at Duluth in which leading Republicans had an interest. On July 2, 1864, Congress incorporated the Northern Pacific Railroad Company, gave it a right-of-way of 400 feet and 20 sections of land (12,800 acres) for each mile of road in states and 40 sections (25,600 acres) for each mile in territories for a railroad to extend from Lake Superior by way of the 45th parallel to Puget Sound with a branch down the Columbia to Portland, Oregon. Beyond the primary grant area of 20 miles on each side in the states and 40 miles in the territories, a lieu or indemnity area of 10 additional miles on each side was provided and in 1870 a 91 Acts of June 29 and Aug. 4, 1854, 10 Stat. 302, 575; Donaldson, The Public Domain, p. 265; Folwell, History of Minnesota, I, 327-50; Henry Cohen, "Business and Politics from the Age of Jackson to the Civil War: A Study from the life of W. W. Corcoran" (Ph.D. dissertation Cornell University, 1965), pp. 329-55. 92 Cohen, "Business and Politics," pp. 368-69. second 10-mile indemnity area was made available. Thus was endowed the longest railroad in America-2,128 miles from Duluth to Tacoma and Portland-with by far the largest land grant, estimated at 45 million acres, to be selected within a strip of land 80 miles wide in the states and 120 miles wide in the territories. This was an area larger than the State of Missouri.93 Unlike the Union Pacific and the Central Pacific, which together completed the first transcontinental railroad in 1869 but which were built through areas where notable communities had been established before construction, the second transcontinental, the Northern Pacific, was projected almost entirely through virgin territory with no development of any importance anywhere along its line.94 Advocates hoped that the land grant would provide the cost of construction; as events turned out it did go a long way to meet the cost, but that was only after many years. Until then, the sale of bonds and equity capital produced the necessary funds. Prematurely planned, with its bonds a drug in the market, interest accumulating, and earnings from a partly constructed line in- 93 13 Stat. 365; 16 Stat. 378. 94 Jay Cooke and Company's appraisal of the Northern Pacific grant as of 1870 differed very markedly from that of later railroad officials who were trying in the 1930's to minimize the land grants and their part in providing the cost of construction. As financial agent of the Northern Pacific, the Philadelphia banking house published a brochure to attract capital; on p. 4 of The Northern Pacific Railroad; Its Route, Resources, Progress and Business, appeared the following on the 50 million-acre grant: "This superb estate is larger by 10,000 square miles than the six New England States, or as large as Ohio and Indiana combined. There is room in it for ten States as large as Massachusetts, each of them with a soil, climate, and resources of coal, timber, ores of metals, and perpetual water-power, altogether superior to those upon which Massachusetts has become populous, rich, refined and politically powerful." Estimates of the value of the Northern Pacific's "'landed empire" ranged in this brochure from $165 million to $550 million (p. 14). |