first of the great railroad magnates and the shrewdest business
genius of the day, Cornelius Vanderbilt. Though he had spent his
early life and had laid the basis of his fortune in steamboats,
he was the first man to appreciate the fact that these two
methods of transportation were about to change places--that water
transportation was to decline and that rail transportation was to
gain the ascendancy. It was about 1865 that Vanderbilt acted on
this farsighted conviction, promptly sold out his steamboats for
what they would bring, and began buying railroads despite the
fact that his friends warned him that, in his old age, he was
wrecking the fruits of a hard and thrifty life. But Vanderbilt
perceived what most American business men of the time failed to
see, that a change had come over the railroad situation as a
result of the Civil War.

The time extending from 1860 to about 1875 marks the second stage
in the railroad activity of the United States. The characteristic
of this period is the development of the great trunk lines and
the construction of a transcontinental route to the Pacific. The
Civil War ended the supremacy of the Mississippi River as the
great transportation route of the West. The fact that this river
ran through hostile territory--Vicksburg did not fall until July
4, 1863--forced the farmers of the West to find another outlet
for their products. By this time the country from Chicago and St.
Louis eastward to the Atlantic ports was fairly completely
connected by railroads. The necessities of war led to great
improvements in construction and equipment. Business which had
hitherto gone South now began to go East; New Orleans ceased to
be the great industrial entrepot of this region and gave place to
St. Louis and Chicago.