7.5. FINANCING THE CONSTRUCTION OF THE GALENA

While the Bostonians were finalizing the financing needed to start construction in Michigan, Ogden was desparately searching for financing to start the G&CU. The G&CU’s new Board’s political friends had seen to the rechartering of the company in the State legislature that was approved on February 24, 1847. This increased the size of the Board of Directors to thirteen and the size of the company’s stock to three million dollars. On April 5, Ogden was formally elected as the new company’s president who named Turner as its Superintendent and John Van Nortwick as Chief Engineer. Ogden’s group now owned a company worth three million dollars (that included the title to 940 acres of woodland along the Des Plaines River, from which ties and fuel could be obtained), while they had not put a penny of their own money into the company. Ogden then had made an inspection trip along the proposed route of the railroad up to Rockford, from where he changed course and went north into Wisconsin, following the Rock River, that was becoming the center of the NorthWest’s emerging wheat belt. By this date, Galena’s lead had been supplanted by the region’s wheat crop as the area’s top grossing product. (In fact, the G&CU tracks would never reach Galena.) Stopping first at Beloit, at the stateline, and then at Janesville, the largest inland town in Wisconsin with a population at the time of 2,500, he querried if there was any interest among its inhabitants for a branch line of the G&CU. Ogden’s northernly detour indicated that he was not only interested in building a railroad west to the Pacific, but also an entire network of roads criss-crossing the entire NorthWest.

Map of the completed Chicago & NorthWestern Railroad as built by Ogden. Note the original route to Galena was never completed because Ogden wanted to build two routes: one to Council Bluffs for the transcontinental railroad, the second one through Wisconsin to ring off Milwaukee. (Online)

Although the Rockford meeting that January had been well-attended by residents along the proposed route, Ogden needed some kind of major publicity event that would generate national publicity for the small, but growing town of Chicago in order to divert attention away from St. Louis that was, at this moment, basking in the glory of Whitney’s reports and energies. Having pushed the country into war with Mexico on May 13, 1846, Pres. Polk then gave Ogden what he so badly needed on Aug. 3, 1846: he vetoed the Congressional funding bill that included money for the dredging operations at the mouth of the Chicago River and in the process, set off a major revolt in the NorthWest that culminated in the 1847 Rivers and Harbors Convention. What would be the city’s first national convention was just the opportunity Ogden needed to showcase the potential of the nascent metropolis to a nationwide audience, including the Boston owners of the MC.

Following the highly successful convention in July, representatives of the MC began investigating the options open to them to extend the railroad to Chicago. Rather than build to St. Joseph on Lake Michigan, that had been designated as the western terminus of the line in the company’s original charter, Forbes had approved Brooks’ proposal to plot a southwestern course to the Indiana border at New Buffalo (appropriately named in honor of the terminus of the Erie Canal at Lake Erie), some twenty-five miles closer to Chicago in anticipation of continuing the line to Chicago in the near future. From New Buffalo, a lake steamer could then be boarded for the ride to Chicago, where the Bostonians’ canal was on the verge of completion (the switch to New Buffalo would also reduce the length of the lake steamer trip by some fifteen miles). While the realignment of the Central’s route telegraphed Forbes’ intention to go to Chicago, it was also meant as an attempt to block a potential albeit dormant competitor, the Southern Michigan Railroad, whose own charter terminated its route at New Buffalo.

Once news reached Ogden that the MC was considering extending its tracks to Lake Michigan at New Buffalo, with the goal of eventually building a line around Lake Michigan to Chicago, he and Scammon unilaterally (and naively) announced that the G&CU would become the natural next link in the road to the west. Ogden had organized the G&CU along the lines of an East Coast stock corporation, the first in Chicago, and put up stock in the company for subscription on August 10, 1847. This was followed up with the publication of a pamphlet for distribution in Wisconsin that laid out his plan for a branch line that extended from Rockford north, following the Rock River to Beloit. Only $20,000, however, was raised in Chicago by this method, for not only were many people suspicious of the motives of Ogden, the real estate agent, but also Chicago merchants feared that a railroad into Chicago would hurt their business:

“Chicago is a retail center, dependent on the farmers who come to trade. If they can ship their produce on a railroad they won’t come to town. Villages, perhaps cities, will spring up along the right of way and farmers will trade there, nearer home. Grass will grow in the streets of Chicago if railroads come.”

The only recourse left open to Ogden and Scammon was to canvass the entire countryside along the proposed route during the Fall of 1847, giving speeches to whomever would stop to listen and to cajole from all who came a commitment to buy at least one share, even if it meant they had to borrow the first payment from Ogden against the upcoming harvest, for after all, the railroad was being planned to expedite the tedious process that farmers had to endure in bringing their crops to the Chicago market. Enough was subscribed through this campaign to pay surveyor Richard Morgan to commence a survey of the route to the Fox River in September, in preparation to let the first construction contracts during the upcoming Spring of 1848.

It wasn’t just the transportation of wheat from the burgeoning farms in the west for which Ogden was planning, but in true synergistic thinking, he was also making provision for increasing the harvesting capacity of these farms with the help of a new machine, the “Virginia reaper.”