The Santa Fe Route, or the Atchison, Topeka and Santa Fe Railroad,
which has in modern times developed into one of the largest and most
profitable railroad systems in this country, was projected long before
the idea of a transcontinental line to the Pacific coast had taken full
possession of men's minds. As early as 1858 a plan was worked out for
the construction of a line of about forty miles within the State of
Kansas to connect what were then the obscure and unimportant townships
of Atchison and Topeka. At that time not a mile of railroad had been
built in Kansas or in any Territory west of that State, except on
the Pacific coast, to which there had been an enormous immigration
occasioned by the wonderful discovery of gold.
The outbreak of the Civil War delayed the undertaking of the
Atchison-Topeka line, and nothing more was done until 1868. In that year
new interests took control of the enterprise and acquired rights for its
extension through southwestern Kansas in the direction of Santa Fe,
the capital of the Territory of New Mexico. The company, which had
originally been the Atchison and Topeka, now changed its name to the
Atchison, Topeka and Santa Fe and obtained from the Government a very
valuable land grant of 6400 acres for every mile constructed, the only
condition being that within ten years the line should be completed from
Atchison to the western border of Kansas. The plan involved the building
of only 470 miles of road, which when finished would assure the company
nearly three million acres of land within the State of Kansas.
A decade would seem to be ample time for the construction of this
comparatively short railroad, particularly with the inducement of so
extraordinary a land grant. Not only the Union Pacific but the Central
Pacific and Kansas Pacific--all built within this decade--had to
accomplish far more construction in order to secure their respective
grants, and yet they had their complete lines in operation years before
the Santa Fe had fifty miles of track in actual commission. The reason
for this delay was of course a financial one. The other roads had
all received government aid in cash or securities in addition to land
grants. But the Atchison line was, from the start, thrown on its own
resources in raising capital, and it was not until late in 1869--nearly
a year after the opening of the Union Pacific to the coast--that any
construction work whatever was done. In that year the section from
Topeka to Burlingame, consisting of about twenty-eight miles, was opened
for traffic, and a year later the extension to Emporia was finished,
thus making a total of sixty-one miles under operation.
The terms of the land grant provided that the entire line across Kansas
should be completed by June, 1873. When by 1872 only sixty-one miles of
track had been built, the company still had over four hundred miles to
go within ten months if it expected to obtain the land grant. But so
energetically did the owners of the property work from that time on that
within seven months they had reached the eastern boundary of Colorado
and had thus saved the grant.
But like most of the Western railroads built in those early days the
Santa Fe property was, in a sense, ahead of its time. The rapidity with
which it shot across the State of Kansas in 1872 was equaled only by the
promptness with which it fell into financial straits. No sooner had its
complete line been opened for traffic than the panic of 1873 occurred;
the company became embarrassed by a large floating debt; and a
compromise had to be made with the bondholders whereby a postponement of
a year's interest was arranged.
No attempts were made to extend the Santa Fe during the long period of
depression following the panic of 1873. The road ended in 1872 at the
Colorado state line, and during the next few years the only building of
importance was a western spur to connect with the Denver and Rio Grande
at Pueblo, thereby giving an outlet to the growing city of Denver
and the rapidly developing mining regions of Colorado. About 1880,
construction was resumed in a leisurely way, down the valley of the
Rio Grande into New Mexico and in the direction of Albuquerque. In this
extension, as in later building, the line of the old Arizona trail was
usually followed. One writer has declared that "the original builders of
the Atchison followed the line of the Arizona trail so religiously that
if the trail skirted a ten-foot stream for a quarter of a mile to strike
a shallow spot for fording, the railroad builders did likewise, instead
of bridging the stream where they struck it, and where the trail ran
up a tree or hid in a hollow rock to avoid the wolves or savages, the
railroad did the same!"
The traveler of a generation ago over this particular section of
the Santa Fe lines might have felt that there was some truth in this
criticism; but the Atchison has long since cut out these idiosyncrasies
of early construction, and the main line in this section of New Mexico
is now noted for alinement and absence of curves and grades.
The builders of the Santa Fe lines in the early days no doubt planned
ultimately to penetrate to the Pacific coast, knowing that the real
opportunity for the road lay in that direction. The Southwest was yet
but sparsely settled; and no railroad which had as its objective the
plains or alkali deserts of Arizona or New Mexico could thrive--at least
it could not for decades to come. And yet in the early eighties the real
objective of the Atchison system had not been determined. Having
passed its original objective point, Santa Fe, the road had reached
Albuquerque, but it could not afford to stop there. Through traffic it
must have or die. New Mexico, with its thin population and its total
lack of development, could not supply traffic in sufficient amount even
to "feed the engines."
To extend somewhere, then, was an imperative necessity. But whither?
Several routes were under consideration. The Southern Pacific lines had
worked eastward to El Paso on the Mexican border, several hundred
miles due south from Albuquerque, and it looked feasible to extend the
Atchison to that point and arrange a traffic agreement with the Southern
Pacific, or to build an extension through New Mexico to Deming and then
westward along the river valleys and down into Mexico to Guaymas on
the Gulf of California. It was possible, in the third place, to build
directly west from Albuquerque through Arizona and Southern California
to the coast. Ultimately all of these plans were carried out.
The first extension of the Santa Fe was to Deming, New Mexico, where
in March, 1881, its tracks met those of the Southern Pacific, and by
agreement the company secured the use of the Southern Pacific to Benson,
Arizona. From the first this new through route to the Pacific began to
pay handsomely. Later on the line into Guaymas, Mexico, was added by the
purchase of the Sonora Railway. Soon afterward the Santa Fe secured from
the St. Louis and San Francisco Railway a half interest in the charter
of the Atlantic and Pacific, a company which planned to build through to
the coast. Meanwhile the St. Louis and San Francisco had been acquired
by the Gould and Huntington interests, which, as the owners of the Texas
and Pacific and the Southern Pacific systems, naturally opposed the
plans of the Santa Fe. The matter was compromised by the agreement of
the Santa Fe to build no farther west than the Colorado River, where the
Santa Fe was to be met by an extension of the Southern Pacific line from
Mojave, California.
This arrangement proved unprofitable to the Santa Fe, for the Southern
Pacific naturally diverted traffic to El Paso and Ogden. A new
arrangement was accordingly made in 1884, involving the purchase, by the
Atlantic and Pacific, of the Southern Pacific division between Needles
and Mojave, the obtaining of trackage rights between Mojave and
San Francisco, and the use of the Southern Pacific terminals at San
Francisco. To assure a connection with the coast in Southern California,
the Santa Fe built a line to Colton, acquired the California Southern
Railway from Colton to San Diego, and effected an entrance to Los
Angeles by leasing the Southern Pacific tracks from Colton.
The Santa Fe had now reached the Pacific coast over its own lines, but
it was handicapped by poor connections with the East. Its next move
therefore was eastward to Chicago, where it acquired the Chicago and
St. Louis Railroad between Chicago and Streator, Illinois, and then
constructed lines between the latter point and the Missouri River.
During the same year the company opened branches southward to the Gulf
of Mexico, until by May, 1888, the entire system comprised 7100 miles.
This rapid expansion of the property, combined with extravagance in
management and a reckless policy in the payment of dividends, brought
the company into financial difficulties within a year after the
completion of the system. Unprofitable branches had been built, and
these had become an immediate burden to the main system. It is the same
story that has been told of most of the large railroads of those days.
Strenuous efforts were made to save the property from a receivership,
and a committee was appointed in September, 1889, to devise ways and
means of reform and reorganization.
The new management of the Santa Fe was a rational one and substantially
reduced the obligations of the road. Had its spirit been maintained, a
second failure and reorganization a few years later would not have been
necessary. New interests, however, came into the property, and, though
it was hoped that they would support a conservative policy, the former
programme of expansion was resumed until in 1890 the St. Louis and San
Francisco system was merged with the Santa Fe on a very extravagant
basis. Within a year it was clear that the St. Louis and San Francisco
would prove more of a liability than an asset. During the same time the
less important purchase of the Colorado Midland Railway also turned out
to be a poor investment.
The next four years were marked by more bad financial management
which culminated in the failure of the reorganized company. In 1892 an
exchange of income bonds for fixed interest-bearing bonds so increased
the fixed charges of the company that, as a result of the panic of 1893
and its ensuing depression, the great Santa Fe system suddenly found
itself in the hands of a receiver. The president, John W. Reinhart, had
persistently asserted throughout 1893 that the company was financially
sound; but an examination of its books subsequently made in the interest
of the security holders disclosed gross irregularities, dishonest
management, and manipulation of the accounts.
During the year 1894 the property was operated under the protection
of the courts, and early in 1895 a new and comprehensive scheme of
reorganization was carried out. This latest plan involved dropping the
St. Louis and San Francisco system, the Colorado Midland, and all other
unprofitable branches; it wiped out the floating debt; it supplied
millions of new capital; and it enabled the succeeding management at
once to build up and improve the property.
At the head of the new company was placed Edward P. Ripley--a railroad
manager of great executive ability and a practical, broad-minded
business man of the modern type, who has ever since remained president
of the road. The history of the Santa Fe since 1895 has been closely
identified with Ripley's business career, and its record during these
two decades has been an enviable one. Steady progress from year to
year in volume of business, in general development of the system,
in improvement of its rights of way, terminals, and equipment, has
characterized its history through periods of depression as well as
times of prosperity. Its resources have grown to vast totals; its credit
equals that of the best of American railroads; its stocks and bonds are
prime investments; and each year it pours millions of dollars of profits
into the hands of its stockholders.