How Much Are We Worth During War?

In 1810, the United States' Gross National Product was 517 million dollars. By 1909, according to lecture, it had grown to $25,968 million. How did a nation of rural farmers evolve into an industrial heavyweight? Although there were many factors that allowed the U.S. economy to expand, the combined effect of railroad construction and maturation, the development of banking and financial structures and support from foreign capital flows allowed America to become a modern nation.The construction of railroads revolutionized transportation, stitched together a national market and boosted economic development as a whole. Before railroads, one had to transport goods by wagon, or take long, often perilous sea routes. Atack and Passel note that early forms of transportation suffered from high costs, slow delivery times and irregular service (Atack 143). In the 1830s, canal and steamboat routes allowed commerce to develop, but these routes were limited to regional waterways. Railroads, however, reduced travel times, could travel in spite of bad weather and provided many social benefits to local areas. For instance, lecture explained that small towns would crop up around railroad junctions, leading to the creation of more markets. Railroads also created demand for products nationwide. Products grown in the Midwest could be shipped to western states like California, or once isolated regions like the South. Indeed, by 1899, commerce had become the largest sector of GNP (32%) according to lecture. This national network greatly expanded the demand for products like cotton and wheat. With steel rails and refrigeration cars, railroads helped make sure that transportation would be smoother and more versatile. Refrigeration cars allowed transportation of once perishable goods, thus allowing for an explosion of the cattle industry. In addition, the continued construction of railroads added to the nation's capital stock. When railroads first began building after the Civil War, this "take-off period" further accelerated industrialization that had begun in the 1840s. As Atack and Passel put it, "Rhetoric aside, the railroad was important whether its contribution was less than 5 percent in 1859 or 1890. Almost certainly no other nineteenth-century innovation mattered more" (455).