To some extent the growth of California’s economy in the 1870s and 1880s, and that of western America as well, was tied to the expansion of the Southern Pacific Railroad. Literally and figuratively the emergent railroad giant was an engine powering the development of a greater California. Headquartered in San Francisco, the Southern Pacific’s sprawling network of tracks constituted the first nationwide and international transportation system.
By 1900 it had branch offices in major cities throughout the United States and Europe, and boasted the world’s largest transit network. The Southern Pacific achieved its domination of western railroading by absorbing the Central Pacific and taking over smaller carriers, establishing numerous routes within California and between states in the western and southwestern regions, selling subdivided land grant parcels to settlers, providing refrigerated rail cars for eastward-bound produce and agricultural information to growers, and developing an effective advertising program to lure farmers and others to the Golden State.
Chartered in California in 1865, the still unbuilt Southern Pacific Railroad was bought by the Big Four three years later. The Associates then folded the Central Pacific into their growing corporation, continuing to acquire other lines as opportunities presented themselves. Anxious to eliminate the possibility of a competing transcontinental line into southern California, the Big Four hastily built a Southern Pacific line south from the Central Pacific junction at Lathrop through the San Joaquin Valley to Los Angeles and then the Colorado River. Three thousand Chinese workers laid the roadbed, bridging that river and making Yuma, Arizona railroad-accessible by autumn 1877. During the 1870s the Southern Pacific began construction on a second north-south route from San Jose to Los Angeles. In 1876, amid great fanfare and after paying the Big Four a $600,000 subsidy plus ceding the rail line to San Pedro, Los Angeles was linked to the state’s northern transcontinental route. This so-called “coastal route” was opened in sections and finished in 1901.
In addition to these main lines, the Southern Pacific bought or built numerous branch lines throughout the state during the last three decades of the nineteenth century. Railroad historian Richard Orsi notes that by the late 1870s the Southern Pacific had established a monopoly on rail traffic in California. The company was capitalized at $225 million, and owned 2,340 miles of track and 85 percent of the railroads in the state, including all the important lines in the San Francisco Bay Area, Los Angeles, and the Sacramento and San Joaquin valleys.
During the 1880s the Southern Pacific registered even more spectacular growth, causing some organizational restructuring. The completion in 1883 of a second transcontinental railway, the famed “sunset route” connecting San Francisco and New Orleans, gave the Big Four access to the carrying trade of the Gulf of Mexico. Simultaneously, the Associates extended tracks from the Sacramento Valley into the Pacific Northwest, reaching harbors at Portland and Coos Bay as well as the fertile Willamette Valley.
The rapid growth of the Big Four’s railroad enterprise necessitated corporate reorganization. Because some states did not allow out-of-state railroads to operate within their jurisdictions, separate Southern Pacific Railroad companies had to be established in different states, which added to the costs and burdens of management. Moreover, the railroad’s mergers and acquisitions increased its size and complexity. To address these challenges posed by growth, the Big Four established a large holding company - the Southern Pacific Company - in 1884 to manage their far-flung transportation empire. Holding companies bought controlling shares of stock in businesses operating within the same industry, thereby reducing competition. Though incorporated in Kentucky, because of California’s business-friendly laws the California-created rail giant remained headquartered in San Francisco. Leland Stanford served as president. Due to Stanford’s time-consuming work as a U. S. Senator, however, Huntington, resentfully at times, handled financial matters in both Washington, D. C., and New York.
The following year, by which time the new holding company operated some 5,000 miles of track and owned dozens of railroad companies in addition to extensive interstate and international maritime shipping enterprises (discussed later), the Southern Pacific Company bundled management into two huge systems. Operating rail lines west of El Paso, Texas, Alban N. Towne oversaw the Pacific System from his San Francisco office. Working out of New Orleans, A. C. Hutchinson supervised the Atlantic System, which included rail business east of El Paso. In order to make informed decisions, the Big Four instituted coherent and comparable accounting procedures among the Southern Pacific’s affiliates. These efficiency measures came just in time, for in November 1885 a transcontinental competitor arrived in California - the Atchison, Topeka & Santa Fe Railroad had reached San Diego.
The Southern Pacific’s land dealings, criticized by contemporaries and many historians, added to the company’s profits from 1865 to the end of the century. According to the railroad’s documents the sale of subdivided government land grants was aimed at providing “limited quantities [of acreage] to those who will cultivate the soil, and who will own the land they cultivate.” Numerous small farms would foster regional prosperity and build an expanding customer base for traffic as growers would need rail access to markets. To feed this traffic, the railroad operated an international land sales office in London, resulting in the settlement of immigrant European farmers in California. Regarding these arrivals, the Reno Gazette grumbled in an 1876 issue that “this afternoon the westbound emigrant train disgorged the shabbiest lot of mortals it has been our misfortune to see for some time. The bell rang, all got aboard and went off. Reno. . . [was] relieved, but we could not help feeling for California.”
Such social commentaries aside, historian Richard Orsi places the Southern Pacific’s federally granted California land holdings in the range between 3 million and 5 million acres by 1900. However, the railroad owned an aggregate of some 18 million acres in such grants in California, Oregon, Nevada, and Utah. Still, the bulk of the Southern Pacific’s profits came from its transport operations, which were greatly enhanced by the carrier’s founding of farm towns in the San Francisco Bay and Los Angeles areas, the San Joaquin Valley, Oregon, Nevada, Arizona, and Texas.
The Southern Pacific’s provision of refrigerated rail cars made possible the nationwide marketing of California’s fruits and vegetables, while the railroad’s dissemination of agricultural information among growers promoted an important new sector of the state’s economy. Moreover, the company contributed financially to the growth of agricultural colleges in California, Arizona, Nevada, Oregon, and Texas. The resulting boost given to scientific agriculture ensured a steadily increasing flow of produce that would be carried by the railroad. A clearer example of the Southern Pacific acting on the basis of enlightened self-interest would be hard to imagine.
Because more settlers meant a larger customer base for its carrying services, the Big Four developed an effective promotional campaign to lure people, especially farmers, to the Golden State and other parts of the West. Both company and outside writers were employed. For example, nationally prominent journalist Charles Nordhoff, a freelancer
Hired by Collis P. Huntington, published California: For Health, Pleasure, and Residence (1873). Nordhoff assured readers that California’s violent frontier conditions were in the past; good farmland was plentiful and just waiting to be tilled. From the 1870s through the 1890s, the railroad used the world fairs, held in Europe and the United States, to display lavishly the fruits and other products of the state, including woods, wines, cereals, minerals, and a host of manufactures. The fact that California won 42 prizes for its fruit displays at the World’s Industrial and Cotton Exposition, held in New Orleans in 1884-5, was due largely to the efforts of the Southern Pacific. The railroad’s 1898 launching of Sunset magazine, a San Francisco monthly, did much to boost the fortunes of the Southern Pacific and the state. By 1904 the publication boasted 58,000 subscribers nationwide, and the railroad constituted the largest corporation in the West.
Pacific Profile: Seafaring Journalist Charles Nordhoff
Charles Nordhoff (1830-1901), was born in Erwitte, Prussia, and immigrated to the United States in 1845. He received some education in Cincinnati but mostly was schooled informally during a boyhood printing apprenticeship and especially his nine years at sea in the U. S. Navy, serving on a whaler, and in the merchant marine. Most of his sea wanderings and journalistic writings centered on Pacific venues: California, the West Coast, and Hawai’i. Nine Years a Sailor (1857) and Stories of the Island World (1857) chronicled his early years afloat.
In the early 1870s, Nordhoff moved into political and travel journalism, writing and editing for the New York Evening Post and reporting for the New York Herald. During these years he voyaged to San Francisco, Honolulu, and the Columbia River. Either by ship or stagecoach (the record is not clear), he made his way down to San Diego as well.
It was the Southern Pacific Railroad that commissioned him to write the book on these ventures referred to just above, California: For Health, Pleasure, and Residence. His promotional volume covered numerous subjects, including climate, scenery, the Central Pacific Railroad, the Chinese, and more. In it he wrote, “California has certainly the finest climate in the world.” He made this statement with reference to the coastal areas of Santa Barbara and San Diego, whose sea breezes and mild temperatures he loved and equated with health. California’s landscapes and seascapes enthralled Nord-hoff. The several books he read about Yosemite did not prepare him for the grandeur he witnessed: “No man
Can so describe the Yosemite Valley as to give to one who has not seen it even a faint idea of its wonderful, strange, and magnificent scenery.” Beyond Yosemite’s giant redwoods and granite peaks, he urged readers to voyage along California’s coast, which “has a great deal of fine scenery.” Concerning other topics the book addressed, Nordhoff was full of praise for his literary patron, the Central Pacific Railroad and its founders. The Big Four were credited for their vision, honesty, and establishment of one of the “most thoroughly built and equipped and best-managed [railroads] in the United States.” Being on their payroll, what else was he to say?
The Chinese, employed by that railroad and as agricultural field hands and abalone-hunters, also fared well in the book. “They learn very quickly, are accurate, painstaking, and trustworthy, and especially as gardeners and for all hand-labor they are excellent.” Nordhoff urged that the U. S. government allow more Chinese women to immigrate to America’s shores to reduce the number of brothels in the state’s Chinatowns. Education and conversion to Christianity would, he thought, enable the Chinese to discontinue opium-smoking. Nordhoff traced the lives of Chinese American abalone-hunters in arid Baja California. Supplied with food and water by a San Diego sea captain, these border-crossing hunters sent back with the schooner master cargoes of cut, cured, and packed abalone meat that would then be shipped up the coast to San Francisco. There the cargoes would be loaded onto China-bound merchant vessels. Here is another illustration of California’s growing ties
To the Pacific Basin. Nordhoif’s own ties to a greater, Pacific California solidified when he purchased a ranch near Ensenada, and settled during the later years of his adventurous life in Coronado, near San Diego.
Northern California, Oregon, and the Sandwich Islands (1874) constituted a second book of his, connecting the Golden State to the Pacific world. It also evidenced the anti-imperialist views that informed his New York Herald writings against America’s possible annexation of Hawai’i in 1893-4.
Nordhoff died in San Francisco, a city whose population was “more uniformly civil, obliging, honest, and intelligent than they are anywhere in this country, or. . . in Europe.” Highly respected and influential in his day among politicians and journalists, curiously he has no biographer. Far more famous is his Polynesia-sojourning grandson, Charles Bernard Nordhoff, coauthor of the acclaimed Mutiny on the Bounty trilogy that was adapted for the award-winning film by that title in 1935.
World History
