The American Nation A History of the United States, Combined Volume (14th Edition)

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This “hypothetical” water-based transportation system
might have been as efficient as the railroads. In 1890, the cost
of transporting wheat from Chicago to New York City was
5.2 cents per ton-mile by rail, but only 1.4 cents by water.
Fogel estimated that a water-based transportation system
would have saved $38 million in carrying costs annually,
though there would have been additional costs in ware-
house construction and spoilage (boats are slower than
trains). The railroads, in short, were not “indispensable” to
move foodstuffs to eastern cities.
For decades, Fogel’s argument was regarded by most
historians as mathematical trickery: the fact is that railroads
and industry emerged nearly simultaneously in all industrial
nations: Is that not proof of the centrality of railroads to indus-
trial development? In 2003, however, historian Richard White
showed that in the late nineteenth century the railroad com-
panies were engaged in massive fraud and deception—
including controlling the news media in order to persuade
investors to buy their stocks. This ensured enormous waste
and inefficiency.
Yet the railroads stimulated economic development in
other ways. Their demand for iron and steel jump-started the

iron and steel industries, crucial for manufacturing and urban

construction. The development of powerful locomotives

gave rise to advances in steam and machine technology.

Perhaps most important, the railroads promoted effective

systems of corporate organization that stimulated economic

development throughout the economy.

ATLANTIC

OCEAN

L.Sup

erior

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L.H

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L.Eri

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Ontario

CANADA

Boston

New York

Philadelphia

Washington

Detroit Buffalo

Minneapolis

Chicago

St Louis

Memphis

New Orleans

Charleston

Kansas City

Toledo Cleveland

Pittsburgh

Cincinnati

Savannah

Feasible commercial agriculture

Navigable river

Existing canal

Proposed canal

Probable major center

of grain shipment

A Hypothetical Water-Based Transportation System, 1890If the nation’s transportation system had been

based on canal construction, the Mississippi River basin would have been the nation’s breadbasket, and the

central plains would have been less significant.

Questions for Discussion

■Why was Chicago the largest center of grain shipment

in 1890?

■Why was Chicago not included as a “probable major

center” of grain shipment in a “hypothetical water-

based transportation system?”

■Interior North Carolina, an important source of wheat

and corn in 1890, would not have figured in a water-

based system. Why?

■How do counterfactual assertions promote historical

understanding?