678 READINGS IN RURAL ECONOMICS 



Domain belonged to the public, compelled the government to 

 change its policy. Under the Pre-emption Law the actual settler was 

 given the preference and protection of the government. Many 

 settlements were made under the law, although the vastness of 

 the territory and the inability to locate all the claims enabled 

 sharpers to manipulate the law to their advantage. On the other 

 hand, it enabled settlers to secure 640 acres of land as much 

 as any man needed at a low price. The Homestead Law was 

 a further increase of the generosity of the government : under it 

 the West was rapidly settled. Like the Pre-emption Act, it was 

 greatly abused, and the loose taxation laws made it possible to 

 hold property without any expense. As land was pre-empted and 

 small towns sprang into existence, there came also the necessity 

 for railroads. March 2, 1833, Congress authorized the state of 

 Illinois to divert the canal grant of six years before, and to con- 

 struct a railroad with the proceeds of said lands. This was the 

 first Congressional enactment providing for a land grant in aid 

 of a railroad, but it was not utilized by the state. Other grants 

 followed, until some 171,014,978 acres had been given by the 

 United States and by the various states for railroad purposes. All 

 this land was given on the condition that within a specified num- 

 ber of years railroads should be built between certain designated 

 points. A portion of this land has been forfeited by non-perform- 

 ance of contract ; but in most cases where the railroad declared 

 itself unable to carry out its agreement, Congress good-naturedly 

 extended the time. The greatest abuse of the grants, however, 

 was the issuing of certificates before the road was built. In this 

 way the company was able to hold its grant, and at the same time, 

 since in appearance at least the government owned the land, the 

 company escaped taxation. The burden which they thus avoided 

 naturally fell upon those who owned land in their own names. 

 Meanwhile the railroad lands, though not cultivated, were increas- 

 ing in value by reason of^ the growing population around them. 

 They were sold to capitalists and others, who, purchasing thousands 

 of acres at a time, in turn speculated upon them. Thus the final 

 purchaser secured the land which he wished to cultivate at a price 

 much higher than would have been asked by the government. 



