Great Fortunes from Railroads | Page 5

of the parties themselves who desire to make the entry!
[Footnote: U. S. Senate Documents, Second Session, Twenty- fourth
Congress, 1836-37, Vol. ii, Doc. No. 168: 5.]
The "credit" system was gradually abandoned by the Government, but
the auction system was retained for decades. In 1847, the Government
was still selling large tracts at $1.25 an acre, nominally to settlers,
actually to capitalist speculators or investors. More than two million
acres had been sold every year for a long period. The House Committee
on Public Lands, reporting in 1847, disclosed how most of the lands
were bought up by capitalists. It cited the case of the Milwaukee
district where, although 6,441 land entries had been made, there were
only forty actual settlers up to 1847. "This clearly shows," the
committee stated, "that those who claimed the land as settlers, are
either the tools of speculators, to sequester the best lands for them... or
the claim is made on speculation to sell out." [Footnote: Reports of
Committees, First Session, Thirtieth Congress, 1847-48, Vol. iii,
Report No. 732:6.]
The policy of granting enormous tracts of land to corporations was
revived for the benefit of canal and railroad companies. The first
railroad company to get a land grant from Congress was the Illinois
Central, in 1850. It received as a gift 2,595,053 acres of land in Illinois.
Actual settlers had to pay the company from $5 to $15 an acre.
Large areas of land bought from the Indian tribes by the Government,
almost at once became the property of canal or railroad corporations by
the process of Government grants. A Congressional document in 1840
(Senate Document No. 616) made public the fact that from the
establishment of the Federal Government to 1839, the Indian tribes had
ceded to the Government a total of 442,866,370 acres. The Indian tribes

were paid either by grants of land elsewhere, or in money and
merchandise. For those 442,866,370 acres they received exchange land
valued at $53,757,400, and money and merchandise amounting to
$31,331,403.
THE SWAYING OF GOVERNMENT.
The trading, banking and landed class had learned well the old, all-
important policy of having a Government fully susceptible to their
interests, whether the governing officials were put in office by them,
and were saturated with their interests, views and ideals, or whether
corruption had to be resorted to in order to attain their objects. At all
events, the propertied classes, in the main, secured what they wanted.
And, as fast as their interests changed, so did the acts and dicta of
Government change.
While the political economists were busy promulgating the doctrine
that it was not the province of Government to embark in any enterprise
other than that of purely governing--a doctrine precisely suiting the
traders and borrowed from their demands--the commercial classes,
early in the nineteenth century, suddenly discovered that there was an
exception. They wanted canals built; and as they had not sufficient
funds for the purpose, and did not see any immediate profit for
themselves, they clamored for the building of them by the States. In
fine, they found that it was to their interest to have the States put
through canal projects on the ground that these would "stimulate trade."
The canals were built, but the commercial classes in some instances
made the blunder of allowing the ownership to rest in the people.
Never again was this mistake repeated. If it proved so easy to get
legislatures and Congress to appropriate millions of the public funds for
undertakings profitable to commerce, why would it not be equally
simple to secure the appropriation plus the perpetual title? Why be
satisfied with one portion, when the whole was within reach?
True, the popular vote was to be reckoned with; it was a time when the
people scanned the tax levy with far greater scrutiny than now; and
they were not disposed to put up the public funds only that private

individuals might reap the exclusive benefit. But there was a way of
tricking and circumventing the electorate. The trading and land-owning
classes knew its effectiveness. It was they who had utilized it; who
from the year 1795 on had bribed legislatures and Congress to give
them bank and other charters. Bribery had proved a signal success. The
performance was extended on a much wider scale, with far greater
results, and with an adroitness revealing that the capitalist class had
learned much by experience, not only in reaching out for powers that
the previous generation would not have dared to grant, but in being
able to make plastic to its own purposes the electorate that believed
itself to be the mainspring of political power.
GRANTS TO CANAL CORPORATIONS.
The first great canal, built in response to the demands of the
commercial class, was the Erie Canal, completed in 1825.