"The Pacific Railroad is the nation, and the nation is the Pacific Railroad. Labor and capital shake hands today. The lion and the lamb sleep together. Here in the West are the representatives of labor and in the East are those of capital. The two united make the era of progress. Steam, Gas, and Electricity are the liberty, fraternity, and equality of the people. The world is on the rampage. Events are earthquakes now.
"Ten millions of emigrants will settle in this golden land in twenty years."
Early in 1864 work was begun on the first hundred miles. The actual work being commenced within the corporate limits of Omaha in February. About one hundred thousand dollars was spent in grading a due westerly route out of Omaha. This was abandoned on account of it being so hilly, and a route south and thence west was adopted. The ties for this section were cottonwood from the Missouri River bottom lands, treated with a view of making them last. It was found that the treatment was not effective and for the balance of the road, hard wood ties from Michigan, Indiana, and even as far east as Pennsylvania were used, some of them costing as much as two dollars and fifty cents laid down in Omaha.
At this time there was no railroad completed into Omaha from the East. The Chicago and Northwestern being the first to reach there, and its first train ran into Council Bluffs on Sunday, January 17th, 1867. Consequently all supplies, other than those coming to them via the Missouri River, had to be wagoned from Des Moines, Iowa, one hundred and thirty-three miles.
On the Missouri River the Company had in service six large steamboats carrying supplies and material for construction from Kansas City where there was railroad connection with the East by way of the Hannibal and St. Joseph Railroad and the Missouri Pacific Railroad.
Everything had to be brought in, the country being destitute of even stone and lumber, involving great expense and delays. While the level country enabled rapid progress to be made in grading, it was almost impossible to bring forward the requisite material to keep up with the graders and track-layers.
The contract for the first hundred miles had been let May, 1864, to Hubert M. Hoxie. By its terms he was to receive securities to the face value of $50,000 per mile. Sidings were to be not less than 6 per cent. of the main line. Station buildings, water-tanks and equipment was to be furnished by him to the value of five thousand dollars per mile. Hoxie before this had been in the employ of the Company in charge of the Ferry between Omaha and Council Bluffs. In March 1865, his contract was transferred to the Credit Mobilier Company, which as has been previously stated, was organized by the promoters and insiders of the Railroad Company to do the actual construction. Several experiences with individual contractors had demonstrated that they could not be relied upon, in fact that it required more in the way of capital-influence, and omnipresence than any individual could exert, consequently all original contracts for the construction and equipping of the line were handled by the Credit Mobilier who subcontracted it with firms and individuals, they by their close relations with the Company and financial interests as well as by their wide ramifications, being able to purchase materials and supplies to better advantage.
Everything was still held at war prices, iron, ties, lumber, provisions, etc., while currency and the Government bonds on which they were relying, were greatly depreciated in value. Labor was scarce and only to be had at extravagant figures.
In the report of one of the Government inspectors, made in 1864, when the grading had progressed some twenty miles out of Omaha, he stated: "There are now some two hundred men employed on the work and a like number of horses and oxen, together with two excavating machines that are doing the work of many men. It is confidently expected that this Section (the first forty miles) will be ready to be laid with rails by June 1st, next." This he regarded as very commendable but as compared with four years later, when there were nearly twelve thousand men engaged and track was going down from two to ten miles a day, it seems anything else but satisfactory.
A great amount of the preliminary work in the way of reconnoissance, surveying, and even locating was done under Governmental auspices previous to 1860, most of it by officers of the army. All of their reports and surveys were by action of Congress given to the Railroad Company, thus saving them greatly in time as well as in money. In addition to the Government surveys the Company investigated and did more or less surveying before deciding upon the route to be followed through the Rockies.