Abstract: Railroads and State Building in the Old South
Using Virginia and South Carolina as test cases, this paper investigates an important regional difference in the antebellum United States. Whereas railroads represented the beginning of the end for state enterprise in the North, southern railroads heavily depended on public investment. State and local governments provided more than 50 percent of the capital for southern railroads, whereas public investment in the North and West amounted to only 15-20 percent of total railroad capital. I argue that the South's reliance on public investment was the result of slavery and land-hungry agricultural practices, which lowered population densities and undermined the profitability of southern railroads. Unable to attract private investment, southern railroads turned to state and local governments as a means to survive. Ideologically, railroad supporters justified public investment as a means of defending slavery. Public investment in southern railroads helps explain the growth of the Confederate State during the Civil War. For Virginians and South Carolinians, public support of large-scale enterprise was hardly a revolutionary experience born of wartime exigency. It was, in fact, the norm of the antebellum period.