Rival Rails: The Race to Build America's Greatest Transcontinental Railroad
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Edward Payson Ripley was born in Dorchester, Massachusetts, in 1845. His father was a merchant, and young Ripley’s first work was in a wholesale dry goods store in Boston. In 1868 he went to work for J. Edgar Thomson’s Pennsylvania Railroad as part of its specialty fast freight line. Two years later, he entered into a long career with the Chicago, Burlington and Quincy Railroad. Ripley worked his way up from clerk to New England agent for the line and then in 1878 became general freight agent for the road out of the company’s headquarters in Chicago.
In 1887 the Burlington made Ripley its traffic manager and soon thereafter its general manager. By this time, he was married with four children and happily ensconced in Chicago’s Riverside area, being a member of the elite Chicago Club. But in August 1890, Ripley resigned from the Burlington and took a job with the Chicago, Milwaukee and St. Paul Railway as a vice president in charge of traffic operations. Here he stayed until tapped by the Santa Fe’s board of directors to lead the reorganized company out of the wilderness.
Central to Ripley’s success would be his understanding of the operating side of the railroad business and his belief that railroads could be run for the public good and still make a profit. He firmly “believed in the good old doctrine that railroads are common carriers, and he would devote his entire energies and those of his subordinates strictly to the railroad business. Convinced that the only business of a railroad is to sell transportation, he would make the Atchison a great and efficient transportation company.…”7
Following the drive of the company westward, the Santa Fe’s board had already decided to close its venerable Boston headquarters and relocate to Chicago, leaving only a financial staff in New York. This suited Ripley perfectly, as he could maintain his family’s status in Chicago and be just that much closer to the operations of his railroad. Indeed, Los Angeles was now only two and one-half days from Dearborn Station on the California Limited.
Upon assuming the Santa Fe presidency on December 12, 1895, Ripley immediately faced many challenges. Some were related to the dismal national economy; others were more internal to the Santa Fe’s own operations. Two issues weighed particularly heavy on his mind. The first was the Atlantic and Pacific line from Albuquerque to Needles. Despite its strategic importance, this segment had never been a paying concern. Several growth spurts notwithstanding, through traffic between the heartland and California did not generate reliable revenues. The general condition of the line was poor, and in many places it needed to be rebuilt with heavier rails and lesser grades.
The Needles-to-Mojave extension of this route that was leased from the Southern Pacific was not in any better shape. Financially, it cost $436,266 a year in lease payments alone. Some of Ripley’s critics suggested that the entire Albuquerque-to-Mojave line should be abandoned and that the Santa Fe should retrench its core system across the plains. This move would leave the hard-won routes in Southern California as orphans, but perhaps they could be sold to the Southern Pacific.
Ripley’s other albatross was the Santa Fe’s Sonora Railway, linking its trackage rights over the Southern Pacific at Benson, Arizona, with Guaymas, Mexico. The road’s construction had seemed like a good idea in the early 1880s, but it developed neither as an effective end-around competition to the Southern Pacific nor as a promising transcontinental link. Northern Mexico was too economically depressed and likely to remain so.
Ripley looked at the map of the Santa Fe system and pondered a solution. Others could attend to the myriad of financial and legal matters. What Ripley cared about most was operating trains. He simply could not fathom severing the Atlantic and Pacific connection to California. Stubbornly, he remained adamant that in time California would boom far beyond the recent spurts and that the 35th parallel corridor would resound with transcontinental traffic.
Ripley contemplated a plan to save the Santa Fe’s link to California, while at the same time trim costs and eliminate liabilities. To bring this about, he went to the Southern Pacific and proposed a handshake far different from the one Collis P. Huntington had extended to William Barstow Strong at Deming years before.
The Southern Pacific was now irrevocably ensconced along the 32nd parallel from Yuma to New Orleans. South of that line, the Sonora Railway was a liability to the Santa Fe and clearly belonged in the Southern Pacific’s orbit. On the other hand, the Mojave–Needles leg of the Southern Pacific had become a 240-mile stub that led nowhere except to the Santa Fe’s lease payments. By handy coincidence, the value of both lines and their relative condition was about the same.
Ripley proposed a trade, and the Southern Pacific agreed. The attorneys would not get done clearing titles and completing the transaction for some years, but beginning in 1897, the Southern Pacific took over operations on the Sonora Railway, and the Santa Fe assumed full responsibility for the Mojave–Needles leg. This meant that Ripley could throw all his corporate energies into what was now clearly the Santa Fe’s main line.
A final uncertainty was removed about the same time when Atlantic and Pacific bondholders foreclosed. Ripley cobbled together a plan whereby the Santa Fe purchased the bonds in default for a combination of new Santa Fe bonds and preferred stock. The result was that the Atchison, Topeka and Santa Fe owned the 564 miles of Atlantic and Pacific line between Needles and Albuquerque outright and was finally the sole owner of its entire length of track between Los Angeles and Chicago.8
Edward Payson Ripley’s shareholders were impressed but not quite ready to cheer. What he had to do next was produce a winning revenue stream. Ripley firmly believed that the best way for the Atchison, Topeka and Santa Fe to regain profitability was to invest aggressively in its existing infrastructure. Consequently, he directed a massive program to upgrade, replace, or rebuild the Santa Fe’s main arteries, rolling stock, and maintenance facilities.
In 1898 alone, 11.25 miles of wooden bridges were replaced with steel or earthen fills, 489 miles of track were ballasted, and 767 miles of heavier rails were laid. New machine shops, depots, and roundhouses were built or expanded, and almost every station between Chicago and El Paso was given a fresh coat of paint.
Most significant for the future, the expensive and laborious process of double tracking—adding a second set of tracks to the right-of-way to facilitate trains running in both directions at once—began in earnest. Twenty-five miles of double track was added between Florence and Emporia, Kansas. Thousands of miles remained to be done between Los Angeles and Chicago, but this was the start toward a double-tracked transcontinental speedway.
Meanwhile, operating revenues climbed from $28.8 million in 1895 to $46.2 million in 1900. A roster of 1,136 locomotives shuttled almost 30,000 passenger, freight, and service cars around a Santa Fe network of almost 7,500 miles of lines owned, controlled, or allied by the company. Ripley’s emphasis on operating efficiencies and debt consolidation converted an annual $4.4 million deficit in 1895 to a $9.7 million surplus for shareholders in 1900. Perhaps the most impressive fact is that Ripley engineered this rebuilding turnaround without incurring additional long-term debt or resorting to floating debt; he did it all out of current earnings. 9
During this time of rebuilding, Ripley undertook one major expansion to complete Cyrus K. Holliday’s transcontinental vision. It had taken the Santa Fe the better part of two decades to break the grip that Huntington’s Southern Pacific held over Southern California—from San Diego’s vote against Tom Scott and the Texas and Pacific in 1872, until the Santa Fe secured its own independent tracks into downtown Los Angeles in 1887. In 1898 Ripley took the final step and announced that the Santa Fe would acquire its own independent tracks from Mojave into San Francisco.
As in the case of the California Southern, the Santa Fe received considerable assistance in this endeavor from an existing road that had begun to challenge the Southern Pacific’s Bay Area market share. As early as 1893, the San Francisco Traffic Association—composed of merchants, farmers, and local shippers—determined not to remain at the mercy of So
uthern Pacific rates, and it made plans to build an independent line from San Francisco Bay to a connection with the Santa Fe at Mojave.
The year 1893 was not a good one for new railroad construction, and in order to save money, an initial plan was devised to employ ferries between the San Francisco–Oakland waterfront and Stockton and to build only 230 miles of railroad from there to Bakersfield, California. But even this effort proved daunting.
Despite widespread motivation to challenge the Southern Pacific, the economic hangover from the panic of 1893 and a fear that the Southern Pacific would simply bull its way into the ownership of any competing venture stalled early progress. Then a major player appeared in the person of Claus Spreckels, a sugar-refining tycoon with substantial interests in the San Joaquin Valley.
When a meeting of the San Francisco Chamber of Commerce reported only half of the venture’s $350,000 initial goal had been subscribed—not enough for even 10 miles of track—Spreckels challenged the group to dream bigger. Within two weeks, fueled by Spreckels’s personal pledge of $500,000, subscriptions had grown to $2 million. Among the supporters were Spreckels’s two sons, Adolph and John, who pledged $100,000 each. (John’s own railroad interests would later include the San Diego and Arizona Railway leading directly east from San Diego to Yuma.)
With the initial logjam broken, stock subscriptions poured in from the rank and file of the San Joaquin Valley. The San Francisco Examiner reported that these amounts were evidence that the new road would be “largely built and owned by people of modest circumstances” and not controlled by the monopolistic railroad powers that Frank Norris would soon write about in his novel The Octopus.
Promptly dubbed “the People’s Railroad,” the San Francisco and San Joaquin Valley was chartered on February 25, 1895, and began laying track south from Stockton that summer. By October of the following year, the line was complete between Stockton and Fresno, and a special excursion train named “the Emancipator” ran to inaugurate the service that many valley residents hoped would emancipate them from the yoke of the Southern Pacific.10
Over the next two years, the railroad built another 110 miles from Fresno to Bakersfield and completed an eastern loop to Visalia. But while revenues were promising, it could not hope to meet operating expenses and retire the construction debt. Up ahead, a 68-mile gap over Tehachapi Pass remained between Bakersfield and the Santa Fe terminus at Mojave.
Claus Spreckels convinced the San Joaquin Valley’s board of directors that the time had come to make a deal with the Santa Fe for an outright purchase of the existing line. Fortunately for them, Edward Payson Ripley agreed. The Santa Fe board of directors authorized the purchase of the San Francisco and San Joaquin Valley for $2,462,300 in December 1898 and got the local investors off the hook. But this still did not close the Bakersfield-Mojave gap or solve the inefficiencies of the Stockton-to-Bay Area ferryboats.
The first bottleneck was Tehachapi Pass. Even if Ripley had wanted to challenge the Southern Pacific there, his engineers soon confirmed that there was simply no room to build a second line—loop or no loop. The end result was that the Santa Fe negotiated a lease from the Southern Pacific of the Tehachapi Pass segment that allowed it to operate its own trains on equal priority over the line. A century later, this agreement is still in place, and the Tehachapi Loop is among the busiest single-track sections of railroad in the United States.
The second bottleneck—ferry service between Stockton and San Francisco—was no easier, but much of it would eventually be eliminated with independent tracks. After the Santa Fe’s purchase of the San Francisco and San Joaquin Valley, Ripley retained its principal engineer, William Benson Storey, to work in that direction. Despite Storey’s gloomy report on the physical obstacles along the 77-mile Stockton-to-Point Richmond route—“the coast range would be pierced by a long tunnel near Martinez, the tule swamps would require considerable dredging and three drawbridges, and the land at Point Richmond needed massive earth and rock fills before port facilities could be built”—the work went forward.
It was difficult construction with water everywhere, from saturated hillsides that made tunneling and cuts problematic, to swamps and tidelands that required long viaducts and high fills. And once the terminal facilities were complete in Point Richmond, there was still the crossing of the bay and construction of similar port facilities in San Francisco just south of the present-day Oakland Bay Bridge.
The flagship of the Santa Fe’s fleet of ferries was the double-ended side-wheeler San Pablo. With the Santa Fe’s cross logo emblazoned on her single smokestack, the San Pablo was a common sight on the bay for some thirty years. Fred Harvey meals were served on the crossing, just as they were on any other Santa Fe Railway conveyance.
On July 6, 1900, Santa Fe passengers departed San Francisco, crossed the bay, boarded a train at Point Richmond, and rode cross-country all the way to Chicago on Atchison, Topeka and Santa Fe rails. This was the final realization of Cyrus K. Holliday’s transcontinental dream. The colonel almost lived to see it.
Over the years, he had never been shy about demanding credit for the birth of the railroad. Recently, when an obituary of a Kansas pioneer mentioned the deceased’s founding role in the Santa Fe, Holliday had been quick to tell William Barstow Strong, “the same thing has occurred for the last fifteen or twenty years, whenever any prominent citizen of Atchison has died. They were all founders of the Santa Fe Railroad, wrote or inspired its charter, etc. [but] it was the ‘inspiration’ of an hour, and of my own, and … I wrote every word and every syllable.…”11
Now, as of March 29, Holliday himself was also dead. But in many respects, not only had the Santa Fe fulfilled his transcontinental dream but it had also made good the boast that young William Jackson Palmer had made to the Big Four back in 1867: They alone would not control the West’s transcontinental destinies.
21
Still West from Denver
As the Atchison, Topeka and Santa Fe clawed its way back from the panic of 1893 and its own overindulgences, one thing had not changed on the map of the American West. There was still no direct rail link through Colorado’s mountains straight west from Denver.
Despite its loss of the Royal Gorge, the Santa Fe never completely gave up the idea of a line through Colorado’s mountains. The road’s independent line from Pueblo north to Denver was completed in 1887. That same year, a standard gauge upstart led by mining man J. J. Hagerman entered the Colorado fray.
Hagerman’s Colorado Midland Railroad built west from Colorado Springs, across South Park to Buena Vista, and then crossed the Continental Divide via a tunnel under Hagerman Pass west of Leadville. From the pass, a tortuous crossing at best, the line descended into the Roaring Fork Valley with a branch to Aspen, which was then enjoying a silver rush long before any boom from its silvery snows.
But there the Colorado Midland faltered. The best the road could do was connect with the Denver and Rio Grande near Glenwood Springs—a connection it might have made at Leadville or Buena Vista some 100 miles of mountain railroading and one backbreaking pass earlier.
Nonetheless, the Santa Fe was interested. From its inception, the Midland had a friendly relationship with the Santa Fe, receiving approximately three-quarters of its westbound passengers and freight from connections with the eastern road. For its part, the Santa Fe viewed the Midland as an excellent feeder into its system. The odd man out proved to be the Denver and Rio Grande. It feared a standard gauge Santa Fe–Colorado Midland connection to the Rio Grande Western at Grand Junction even as the Denver and Rio Grande was converting its circuitous Royal Gorge line over Tennessee Pass to standard gauge.
Consequently, in 1890 the Denver and Rio Grande crowd in Denver led by banker David Moffat approached Hagerman about buying the Midland outright. But somewhere along the line, Moffat and his associates raised the hackles of Hagerman, an independent Midwesterner who’d come west for his health. Well aware of the eastern capital that controlled most western railroads, H
agerman growled, “I do not suppose there are 500 shares of Rio Grande stock owned in Colorado, but to hear the officers here talk, you would suppose they owned it all.”
The Denver and Rio Grande sent its chairman to London to arrange financing for the purchase of the Midland, but the day before he arrived, Hagerman closed a sale to the Santa Fe. Four million dollars was a hefty price to pay, but the Santa Fe considered it necessary to protect its northern flanks and promote a connection in Utah with the Union Pacific. The Santa Fe’s ultimate goal, of course, was a point of entry into northern California, and if nothing else, its acquisition of the Midland proved that the Santa Fe had not forgiven the Rio Grande for past rivalries.
For his part, Hagerman was elated with the deal. Not only did he receive his investment in the Midland back at a tidy profit, but “it enables me with one grand whack,” Hagerman wrote, “to get even with [Moffat’s Denver] combination, and pay them and their followers back for all the sneers, belittlement and other dirt they have heaped on me for the last four years.”
The result for the Santa Fe was not so rosy. In the six years from 1890 through 1895, the operations of the Colorado Midland cost the Santa Fe a $2.25 million loss. In the end, the debt of the Colorado Midland purchase became one of the millstones that pulled the Santa Fe into bankruptcy after the panic of 1893. What the Santa Fe’s brief ownership of the Colorado Midland proved, however, was that the Santa Fe was still concerned about railroad developments on the Sacramento–Salt Lake–Denver axis.
The Colorado Midland emerged from receivership as a separate entity once again. It would linger on the Colorado scene, even building a longer, lower tunnel under Hagerman Pass, but the geography of its mountainous route simply wasn’t conducive to a transcontinental haul. Meanwhile, the standard gauging of the Denver and Rio Grande main line was complete, and that railroad was teaming up with a much more formidable ally than the Midland.1