USA > Illinois > Illinois, historical and statistical, comprising the essential facts of its planting and growth as a province, county, territory, and state, Vol. II > Part 3
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In accordance with the requirement of the constitution, this law was submitted for popular approval at the November elec- tion of 1851. It was adopted by a vote of 37,626 in favor of, to 31,405 against the law - not half the votes of the State, however, being polled.
Notwithstanding the fact that the democratic party had been opposed to banks, all the governors since 1834 having made
37
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ILLINOIS-HISTORICAL AND STATISTICAL.
that opposition a prominent feature in their messages, and although the democrats had control of the legislature by a pre- ponderance of two to one, the measure was introduced by a democrat and received the support of a majority of democratic members. As many whigs, in proportion to their numbers, voted against it as democrats. The bill was returned by the governor with his objections, in which he very clearly set forth its weak points, as they were subsequently admitted to be after the law went into practical operation.
As a system of legitimate banking, it was without proper checks and requirements relating to location, capital, and re- demption, but as a system for furnishing a safe circulating medium, it was well guarded and proved a success up to the time of the rebellion in 1861. Although frequently called upon to put up margins to make good the depreciated stocks deposited as a security for their circulation, they so uniformly responded that out of the one hundred and ten banks in operation at the close of the year 1860, but fourteen had gone out of existence either by voluntary withdrawal or forfeiture under the law. And of these the securities had been found ample to redeem their notes dollar for dollar in specie, with one exception, where there was a loss of only three per cent.
By Jan. 1, 1857, fifty banks had gone into operation, with a circulation of $6,480,873, and by 1860, there were one hundred and ten banks, with a circulation of $12,320,964, secured by stocks of the par value of $13,979,973.
The leading argument in favor of the ratification of this law by the people was the fact that the only currency in circulation was that from other states, whose value could not be so readily and certainly ascertained as that of banks which should be supervised and whose issues should be guarded by our State officers. And whatever the ultimate event, it must be conceded that these institutions furnished a currency which was no small factor in promoting facilities for trade during the unwonted per- iod of prosperity upon which the people of the State now entered. The law was subsequently amended in important particulars, and curtailed of many of its objectionable features; and it may be stated in its defence that the present system of national banking -the best that financial skill has been as yet able to devise-
571
THE ILLINOIS-CENTRAL RAILROAD LAW.
is the outgrowth, with its defects eliminated, of this free, stock- banking system .*
The financial revulsion of 1857, which followed upon the fail- ure of the Ohio Life and Trust Company, while it exhibited the worthlessness of the greater portion of the Illinois institu- tions as banks of business, did not result in any material losses to the people on their circulation. Over $9,500,000 of the $14,- 000,000 of stocks deposited to secure their circulation in 1860 were those of southern states, principally Missouri, Tennessee, and Virginia; and when the National crisis of 1861 came, they at once began to depreciate. Twenty-two banks were called upon in November, 1860, to make good their securities. The agitation of secessionists and apparent determination of several southern states to withdraw from the Union gave rise to a feel- ing of financial uncertainty with resulting disorders throughout the land. Only the bills of those banks which were based upon northern securities passed current, and these were rapidly with- drawn from circulation, while those less favorably secured passed from hand to hand with "a nervous precipitancy which showed the general distrust in their value." Those bills which were quoted bankable one day were thrown out the next, and no one could tell when he laid down at night whether or not he would have enough current money in the morning to pay for his break- fast. It was a trying time for bankers, especially those who held large deposits, the payment of which was variously com- promised by a discount of ten to thirty per cent. By Novem- ber, 1862, only twenty-two solvent banks were reported, while ninety-three had suspended or gone out of business. The banks in liquidation had paid on their circulation all the way from par to as little as forty-nine cents on the dollar, the average being about sixty, involving a loss of nearly $4,000,000. But
* It was found, however, that the circulation of the Illinois banks did not afford a sufficient volume of currency for business wants. To avoid inconvenient presenta- tion of the bills for redemption, they were sent into, and so far as possible circulated in other states, while the bills of other states, for the same reason were brought here. The great variety of currency afloat in 1855-6 is shown in the amount received by a railroad conductor on the C., B. & Q. R. R. during one trip. The total sum was $203 which came from twenty-three different banks, of which Georgia furnished $115, New York $11, Iowa $5, Virginia $5, Tennessee $5, Indiana $5, Wisconsin $6, Ohio 10, Michigan $10, Connecticut $5, Maine $5, Illinois $21 .- Andreas' " History of Chicago," I, 547.
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ILLINOIS-HISTORICAL AND STATISTICAL.
this was so generally distributed and was so amalgamated with current trading as not to work any particular hardship or retard the prosperity of the people.
To return to the legislature of 1851: It was not only respon- sible for the banking law having so important an influence upon the financial interests of the State, but on the other hand was en- titled to credit for that act, pregnant with vastly more momen- tous results, the incorporation of the Illinois - Central Railroad Company. The facts and events which preceded and led up to this action form an exceedingly interesting chapter in the history of the State.
The building of the Illinois-Central Railroad was first sug- gested by William Smith Waite, an old and valued citizen of Bond County, and given to the public in a letter setting forth its importance and feasibility from Judge Sidney Breese to John York Sawyer in October, 1835, and there had been no time since the collapse of the internal-improvement scheme of 1837, of which it was a part, during which its construc- tion had been entirely abandoned. In March, 1843, the Great-Western Railroad Company was incorporated, having for its object the building of the road as originally contemplated upon certain conditions specified in the charter: but the incor- porators being unable to effect any satisfactory arrangement looking toward successful results, although some work was done and considerable money expended, the enterprise was aban- doned and the law repealed in 1845. It was in response to a memorial from the Great-Western Company that the first bill in congress was introduced on the subject by Hon. Wm. Wood- bridge, senator from Michigan. It granted to this company not only the right of way, but the right of preëmpting the public lands through which the proposed line was to pass. It was championed by Judge Breese, and passed the senate May 10, 1844. Having been sent to the house, the Illinois delegation, headed by Judge Douglas and Gen. Mc Clernand, refused to support it, on the ground that the grant of lands, in whatever shape made, should be conferred upon the State and not upon "an irresponsible private corporation."
At the next session of congress, Jndge Breese introduced a bill granting the right of preemption to the State of Illinois
573
THE CONGRESSIONAL GRANT OF LAND.
instead of to the company; but it being the short session, the bill failed to pass.
On Jan. 15, 1846, Judge Breese, having in the meantime been appointed chairman of the committee on public lands, intro- duced a bill granting to the State certain alternate sections of public lands to aid in the construction, not only of the Illinois- Central but the Northern-Cross railroads, in favor of which he made an able and interesting report, but did not urge the adop- tion of the measure, owing, he said, to a lack of sympathy on the part of the Illinois house-members, with the exception of Hoge and Baker.
At the next session, 1847, Judges Breese and Douglas were in the senate together, when the former again introduced his preëmption bill, insisting that capitalists preferred that kind of cession rather than an absolute grant to the State. A confer- ence between the senators failed to reconcile their views-one preferring the preemption, the other, the donation plan. On Jan. 20, 1848, Judge Douglas, failing in his effort to persuade his colleague to make the proposed changes in his bill, intro- duced his own for a grant of land to the State to aid in the con- struction of a railroad from Chicago to the Upper Mississippi, and from Cairo to Chicago. The latter bill passed the senate by a large majority, Judge Breese foregoing his own plan and yielding his support to his colleague's bill for the sake of har- mony. It was, however, defeated in the house by two majority, notwithstanding the earnest efforts of the Illinois members- Robert Smith, John A. McClernand, Orlando B. Ficklin, John Wentworth, Wm. A. Richardson, Thos. J. Turner, and Abraham Lincoln-to secure its passage.
At the next session-Dec. 20, 1848-Judge Douglas again introduced his measure, which had failed of passage in the house at the preceeding session; but the original bill having been reinstated on the calendar of that body, its passage was not urged in the senate. While the contest was going on in the house, Judge Breese again presented his preëmption scheme, to which Judge Douglas gave his reluctant consent, inasmuch as, he said, he was satisfied that in no event could it be carried through the house. It passed the senate without serious oppo- sition, but when reported in the house it was so violently
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ILLINOIS-HISTORICAL AND STATISTICAL.
assailed by Samuel F. Vinton of Ohio, that the senate was induced to recall it and no farther action was taken in regard to it; this ended Judge Breese's connection with the subject as a member of congress.
In the meantime the promoters of and parties interested in the Great-Western Railroad Company were not passive obser- vers of these several efforts to secure congressional action in favor of a grant of Illinois lands, and supposing that the bill which had passed the senate in 1848 would certainly succeed in the house, proceeded to invoke legislative action at home. On Feb. 9, 1849, the old charter was renewed and extended to the Cairo City and Canal Company. This was known as the Hol- brook charter, and the object of the incorporators was to secure the benefit of whatever land-grant congress might make to the State. The act was passed on the very day on which the vote was taken upon the land-grant bill of Judge Douglas in the lower house of congress, its defeat not being anticipated. Sen- ator Douglas visited Springfield soon after, and upon an exami- nation of the manuscript of the law, it having not yet been printed, he discovered the fact that a clause had been surrepti- tiously inserted into the bill conveying to the company all the lands which should be granted to the State of Illinois to aid in the construction of railroads. Upon being interrogated by the senator, the governor, secretary of state, and members of the legislature all denied any knowledge of the clause in the act, and it has always remained a mystery how it came to be inter- polated. Douglas denounced the act in unmeasured terms, and at the next session of congress, upon being urged by Holbrook to reintroduce his bill, threatened that unless his company released its charter he would offer a bill providing for an en- tirely different route, and make it a condition that the grant should not inure to the benefit of any railroad company then in existence .*
All rights under the Holbrook charter were duly released and surrendered to the State by the president of the company, Dec. 24, 1849; and subsequently, at the session of 1851, this release was accepted by law, and the former act of 1843 repealed.
To recur again to the action of congress: at the session of
* Judge Douglas' statement in "The Public Domain, " 262.
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CONGRESSIONAL ACTION.
1849, the senate bill having failed in the house, as before stated, it was necessary to begin anew; and upon consultation between Senators Douglas and Shields and the Illinois members of the house, it was determined to disconnect the proposed grant from any cross-road, and to confine it to the Illinois Central. The bill as finally passed was introduced by Judge Douglas, Jan. 3, 1850. Having failed so often in the house, new and powerful opposition had been aroused against it in the senate-Senators Jefferson Davis and Henry S. Foote of Mississippi, and Wm. R. King and Jeremiah Clemens of Alabama, had become afflicted with constitutional scruples in regard to it and it was now necessary to meet this phase of objective effort. Knowing that work on the Mobile-and-Ohio Railroad had been stopped for want of means, Judge Douglas conceived the idea of includ- ing that enterprise with the Illinois Central. On the pretence of visiting his children's plantation, he proceeded to Mobile and secured an interview with the president and directors of that road and then submitted his proposition, which was gladly accepted. Douglas then informed them of the opposition of their senators, and that to secure the support of the latter it would be necessary to have them instructed by the legislatures of their states. Such action the parties interested thought they had sufficient influence to procure and entered heartily into the project. The instructions came by telegraph in due time, first from Alabama and then from Mississippi. The senators at first stormed and swore, but when letters and written instructions arrived, they came to the judge and asked his assistance; he consented to amend the bill as they desired, so as to include the Mobile-and-Ohio Rail- road, and what might have become a formidable opposition hav- ing been thus changed into active support, the bill passed the senate and was sent to the house.
While there had always been more or less opposition to the passage of the bill in the senate, which required skilful manage- ment to overcome, it was in the house, where a majority had always been found against it, that the hardest work was re- quired to secure success. The members from Illinois at this time were Wm. H. Bissell, John A. Mc Clernand, Timothy R. Young, John Wentworth, William A. Richardson, Edward D. Baker, and Thomas L. Harris, all of whom did more or less
576
ILLINOIS-HISTORICAL AND STATISTICAL.
earnest and effectual work to secure the passage of the bill. Perhaps the most active of all these was John Wentworth. He, more than any other, foresaw and realized the great benefit the building of this proposed road would be to Illinois and espec- ially to the young city of Chicago. He effected trades to secure votes and made combinations in its favor, many of which were only known to himself, but they were efficient and proved to be controlling. It was found that some of the holders of the canal- bonds were also holders of other state-bonds, and as they were mostly residents of the older states and members of the whig party whence came the chief opposition to the proposed grant, it occurred to Mr. Wentworth, as he claimed, that he could secure the influence of bond-holders in favor of the bill. The cooper- ation of the great Webster, then secretary of state, was sought and his valuable advice taken. The whigs wanted an increase of tariff duties and needed recruits to their numbers. They said to Wentworth, who was a democrat but not afraid of the tariff, "let us act in concert." He replied, "you know what we Illinois men want-lead off."
The following graphic account of the final passage of the bill in the house is given in the words of Judge Douglas :*
" When the bill stood at the head of the calendar, Mr. Harris moved to proceed to clear the speaker's table, which was carried. We had counted up and had fifteen majority for the bill, pledged to its support. We had gained votes by lending our support to many local measures. The house proceeded to clear the speaker's table, and the clerk announced 'a bill granting lands to the State of Illinois.' A motion was immediately made by the opposition which brought on a vote, and we found ourselves in a minority of one. I was standing in the lobby, paying eager attention, and would have given the world to be at Harris' side, but was too far off to get there in time. It was all in an instant, and the next moment a motion would have been made which would have brought on a decided vote and defeated the bill. Harris, quick as thought, pale, and white as a sheet, jumped to his feet and moved that the house go into committee of the whole on the slavery question. There were fifty members ready with speeches on this subject, and the
* "The Public Domain," 263; see statement attributed to him.
577
EXTENT OF THE GRANT TO ILLINOIS.
motion was carried. Harris came to me in the lobby and asked me if he had made the right motion. I said, 'yes,' and asked him if he knew what was the effect of his motion. He replied that it placed the bill at the foot of the calendar. I asked him how long it would be before it came up again. He said not this session, that it was impossible, there being ninety-seven
bills ahead of it. Why not then have suffered defeat? It turned out better that we did not. I then racked my brains for many nights to find a way to get at the bill, and at last it occurred to me that if the same course was pursued with other bills it would place them likewise in turn at the foot of the calendar, and thus bring the Illinois bill at the head again. But how to do this was the question. The same motions would each have to be made ninety-seven times, and while the first motion might be made by some of our friends, it would not do for us or any warm friend of the bill to make the second.
"I finally fixed on Mr. - ,* a political opponent but per- sonal friend, who supported the bill without caring much whether it passed or not, as the one to make the second motion-to go into committee of the whole-as often as it was necessary. He agreed to it as a personal favor to me, provided -, whom he hated, should have no credit in case of its success. Harris then in the house, sometimes twice in the same day, either made or caused to be made the first motion, when Mr. - would immediately make the second. They failed to see the point, and the friends of other bills praised us and gave us credit for supporting them. Finally by this means the Illinois bill got to the head of the docket. Harris that morning made the first motion. We had counted noses and found, as we thought, that we had twenty-eight majority, all pledged. The clerk an- nounced 'a bill granting lands to the State of Illinois.' The opposition again started, were taken completely by surprise; said there must be some mistake, as the bill had gone to the foot of the calendar. It was explained and the speaker declared it all right. The motion to go into committee of the whole by the opposition was negatived by one majority, and the bill passed by three majority." +
* George Ashmun of Massachusetts, as suggested by Mr. Wentworth.
+ This is an error. The vote on the passage of the bill was 101 yeas to 75
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ILLINOIS-HISTORICAL AND STATISTICAL.
The bill, which had passed the senate May 2, and thus passed the house on Sept. 17, was entitled "An act granting the right of way and making a grant of land to the States of Illinois, Mississippi, and Alabama, in aid of the construction of a rail- road from Chicago to Mobile," became a law Sept. 20, 1850 This act ceded to the State of Illinois, subject to the disposal of the legislature thereof, for the purpose of aiding in the con- struction of a railroad "from the southern terminus of the Illinois - and - Michigan Canal to a point at or near the junc- tion of the Ohio and Mississippi rivers, with a branch of the same to Chicago, and another via the town of Galena, in said State, to Dubuque, Iowa, every alternate section of land desig- nated by even numbers, for six sections in width on each side of said road and branches." The lands were to be disposed of only as the work progressed, and the road was to be completed in ten years, or the State must pay the proceeds of all sales to the United States and lose the unsold lands. The grant aggre- gated 2,595,000 acres, being at the rate of 3700 acres per mile of the proposed road.
Upon the opening of the session of 1851, Gov. French trans- mitted to the legislature the memorial of Robert Schuyler, George Griswold, Governeur Morris, Jonathan Sturges, Thomas W. Ludlow, and John F. A. Sandford of New-York City, and David A. Neal, Franklin Haven, and Robert Rantoul, jr., of Boston, proposing to form a company to build the road, on certain specified conditions, by July 4, 1854.
Several bills were introduced on the subject, embodying dif- ferent plans, in both houses; but that which finally became the law for the construction of the road was introduced by James L. D. Morrison, senator from St. Clair County. It passed the senate Feb. 6, and the house four days later. The Illinois- Central Railroad Company was organized and accepted the terms of the law the same day. These were, in brief, that in consideration of the cession of the lands granted to the State the company would construct the proposed railroad, within a specified time, and pay to the State seven per cent of its gross annual earnings.
nays. Mr. Wentworth, in conversing with the author on this subject, did not in all respects agree with this account attributed to Judge Douglas, stating that it contained inaccuracies which the record failed to support.
579
CONSTRUCTION OF THE ILLINOIS-CENTRAL.
Roswell B Mason* of Bridgeport, Conn., was appointed chief engineer, and the first portion of the line, from Chicago to Kensington, then called Calumet, was placed under contract. The main line from Cairo to LaSalle, 300.99 miles, was com- pleted June 8, 1855; the Galena branch, from LaSalle to Dunleith, 146.73 miles, Jan. 12, 1855; the Chicago branch, from Chicago to the junction with the main line, 249.78 miles, Sept. 26, 1856.
The road was laid out through the wildest and most sparsely populated portions of the State, where deer and other wild game roamed at will; over boundless prairies, where neither tree nor house were to be seen sometimes for twenty miles; and along the entire route of 705 miles it did not pass through a dozen towns of sufficient importance to be known on the map of the State.
While the grant was a munificent one in its direct advantage to the State, the indirect benefits resulting therefrom were no less marked and apparent. Of the lands donated, there have been sold 2,454,214 acres to 32,000 actual settlers, who at a low estimate must have added 200,000 persons to the population of the State. The sale of railroad lands stimulated also the sale of the alternate sections owned by the government, which for over twenty years had been on the market without a purchaser. The seven per cent of the gross annual earnings, which the State receives from the company, amounted in 1856 to $77,631, and for the next thirty years to $9,828,649, averaging $327,- 621 each year; a sum nearly sufficient to pay the ordinary expenses of the State government.
It is an interesting fact to notice that Douglas and Shields in the senate, and McClernand and Baker in the house, who were in congress when the land-grant bill passed, and Lincoln and Robert Smith, who were active supporters of the measure at the previous session, were members of the celebrated tenth Illinois general assembly, at which was passed the great inter- nal-improvement scheme, and for which they all voted. And thus it turned out that whatever blame might attach to them for errors of judgment and action on that occasion, was nobly atoned for by their subsequent efforts in securing the passage
* Mayor of Chicago, 1869-71, and still living there, (August, 1889,) an honored citizen.
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ILLINOIS-HISTORICAL AND STATISTICAL.
of this law. Already more money has been paid into the State treasury by the Illinois-Central Railroad than was taken out by the adoption of the old internal-improvement system, and that income will not only increase in the future but remain perpetual. For this, if for no other public service to his State, the mem- ory of the great Douglas was justly entitled to preservation by the erection of that splendid monumental column, which, over- looking the blue waters of Lake Michigan, also overlooks for many miles that iron highway which was in no small degree the triumph of his genius and legislative skill.
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