FreightWaves Classics/Fallen Flags: Northern Pacific Railway begins service

A Northern Pacific freight train. (Illustration: legendsofamerica.com)

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On September 8, 1883, the Northern Pacific Railway (NP), which was the first of the transcontinental railroads that ran through states in the northern tier, was officially completed. An extravagant ceremony was held that day near Gold Creek in the southwestern part of the Montana Territory (now the state of Montana). The Northern Pacific ran between St. Paul, Minnesota, and Seattle, Washington, opening a key route that linked the Great Lakes region with the Pacific coast. 

Four trains transported 300 public officials and dignitaries representing the United States, England and the German Empire to the ceremony. Among those who helped to drive in the final spike was Ulysses S. Grant, who was the 18th president of the United States when construction on the line began in 1870.

The driving of the last spike on the Northern Pacific Railway on September 8, 1883, at Gold Creek, Montana. Former U.S. President U.S. Grant is shown with spike maul and at his left is Henry Villard, then president of the Northern Pacific. (Photo of painting: digitalcollections.lib.washington.edu)
The driving of the last spike on the Northern Pacific Railway on September 8, 1883, at Gold Creek, Montana. Former U.S. President U.S. Grant is shown with spike maul and at his left is Henry Villard, then president of the Northern Pacific.
(Photo of painting: digitalcollections.lib.washington.edu)

Early history of the railway

The Northern Pacific was chartered by Congress in 1864 to build a railroad from Lake Superior westward to a port on the Pacific coast. For doing so, it was given a land grant of 40 million acres. Despite the enormous land grant, it encountered issues finding financial backing for its venture into what was then a mostly unsettled wilderness. Then Philadelphia banker Jay Cooke sought to raise $100 million to fund the railroad (over $1.87 billion today). By 1873 the railroad line had been built nearly to Bismarck in the Dakota Territory (now North Dakota). 

The Northern Pacific was one of the keys to the economic growth of the Dakota Territory. The climate, although very cold, was suitable for wheat, which was in high demand across the United States and Europe. Most of the settlers in the Dakotas were German and Scandinavian immigrants who bought cheap farm land and raised large families. The territory’s farmers shipped huge quantities of wheat to Minneapolis (center of the milling industry), while also buying a variety of equipment and home supplies to be shipped in by rail.

Unfortunately, Cooke’s bank collapsed due to the Financial Panic of 1873, a financial crisis that triggered an economic depression in Europe and North America that lasted from 1873 to 1877 in the U.S.

A map of the Northern Pacific Railway. (Image: projects.leadr.msu.edu)
A map of the Northern Pacific Railway. (Image: projects.leadr.msu.edu)

The Panic forced the Northern Pacific Railway into receivership; its construction was halted for six years. In 1878 the railroad was acquired by Henry Villard, an American journalist and financier. After disagreements with the railroad’s former managers, Villard was elected president of a reorganized board of directors on September 15, 1881.

Henry Villard. 
(Photo: mrlincolnandfriends.org)
Henry Villard.
(Photo: mrlincolnandfriends.org)

Under Villard, the railroad was built westward to Helena in Montana Territory, where it was connected with Villard’s Oregon Railway to Seattle in Washington Territory in 1883. It was then that the ceremony was held near Gold Creek in the Montana Territory. 

At that point the Northern Pacific had about 6,800 miles of track. It served a large area, including extensive trackage in the states of Idaho, Minnesota, Montana, North Dakota, Oregon, Washington and Wisconsin. In addition, the NP had a branch that served Winnipeg, Manitoba, Canada. The primary freight carried by the railroad was the abundant wheat and other grains, cattle, timber and minerals. The NP also transported consumer goods and homesteaders (many who bought farmland from the railroad) in the fertile Red River Valley along the Minnesota-North Dakota border. 

An advertisement for the Northern Pacific Railway. (Image: State Historical Society of North Dakota)
An advertisement for the Northern Pacific Railway. (Image: State Historical Society of North Dakota)

Another Panic 

Approximately 10 years after the railroad was completed another financial crisis hit. The Panic of 1893 was a national economic depression triggered by the collapse of two of the country’s largest employers – the Philadelphia and Reading Railroad and the National Cordage Company. Following the failure of these companies, a panic erupted on the stock market. Hundreds of businesses were overextended, having borrowed money to expand operations. When the financial crisis struck, banks and investment firms called in loans, causing hundreds of business bankruptcies across the country. In particular, banks, railroads and steel mills fell into bankruptcy. Over 15,000 businesses closed during the Panic of 1893, which did not end until 1897. U.S. unemployment rates soared to 20%-25%; and homelessness skyrocketed as workers were laid off and could not pay their rent or mortgages. The Panic also led to the political realignment of 1896 and the presidency of Republican William McKinley.

James J. Hill. (Photo: mnhs.org)
James J. Hill. (Photo: mnhs.org)

Because of the Panic of 1893, the Northern Pacific encountered new financial difficulties. It was reorganized by J.P. Morgan, who shared control of the railroad with James J. Hill, whose Great Northern Railway Company was a competitor of the Northern Pacific’s. 

Hill sought to combine the Great Northern Railway and the Northern Pacific Railway with his Chicago, Burlington and Quincy Railroad Company through the Northern Securities Company, with Hill serving as president. (To read more in FreightWaves Classics about James J. Hill and the Great Northern Railway, follow this link for Part 1, and this link for Part 2.) 

20th century developments

However, President Theodore Roosevelt (who had ascended to the presidency after the assassination of President McKinley) opposed the Hill’s railroad combination. Then in 1904 the U.S. Supreme Court declared the Northern Securities Company in violation of the Sherman Antitrust Act and ordered the company dissolved in 1904. 

The Northern Pacific Railway logo. (Image: Adam Burns/American-Rails.com)
The Northern Pacific Railway logo.
(Image: Adam Burns/American-Rails.com)

While the Great Northern and the Northern Pacific were tied with the Chicago, Burlington and Quincy Railroad, both railroads gained critically important access to Chicago, the largest rail hub in the nation. They also gained access to the central Middle West and Texas, as well as the lines of the Spokane, Portland and Seattle Railway, an important route through eastern and southern Washington.

In addition, money was plowed back into the Northern Pacific; Its physical plant was upgraded, including double-tracking in key areas and automatic block signaling along its entire main line. 

The Northern Pacific also maintained and upgraded its equipment and service. It was among the first U.S. railroads to adopt diesel power (beginning in 1944), although because of its Wyoming-based coal reserves the NP was among the last U.S. railroads to complete dieselization (in 1960).

A Northern Pacific freight train. (Photo: trains.com)
A Northern Pacific freight train. (Photo: trains.com)

By 1900, most of the railroad’s remaining land-grant holdings were located west of Montana. As it had further east, the railroad’s management hoped to sell the majority of this land. Land sales would provide operating funds as well as help to populate the region, thereby providing new markets for the railroad. However, nearly all the good farm land had been sold previously, although the timber lands were of high quality. Much of the timber land  was sold to Frederick Weyerhaeuser.

A Northern Pacific freight train. (Photo: pnwr.qstation.org)
A Northern Pacific freight train. (Photo: pnwr.qstation.org)

Railroad consolidation

Despite the Supreme Court ruling, the three railroads continued to be financially linked. In 1970 they were allowed to merge, creating the Burlington Northern, Inc. Then Burlington Northern acquired the St. Louis-San Francisco Railway Company in 1980, and the Santa Fe Pacific Corporation in 1995. The railroad became the Burlington Northern Santa Fe, or BNSF, one of the remaining Class I railroads.

A photograph of a train driving through a desert.
A BNSF train heads to its next destination. (Photo: Jim Allen/FreightWaves)

FreightWaves Classics thanks american-rails.com, Burlington Northern Tribute, BNSF, McGill University, the North Dakota Historical Society and ndstudies.org for information and images that contributed to this article.

Source: freightwaves - FreightWaves Classics/Fallen Flags: Northern Pacific Railway begins service
Editor: Scott Mall

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