“We hold that the government, having created these transportation corporations, has the right and the duty to supervise and control them... The public lands, the wealth of the nation, have been lavished upon these companies to secure the construction of roads that now oppress the very people who paid for them through high tariffs and extortionate freight rates.”
— Resolution of a local chapter of the Patrons of Husbandry (The Grange), 1874
Which of the following government actions in the mid-to-late nineteenth century most directly contributed to the corporate power criticized in the excerpt?
- AThe consistent enforcement of laissez-faire economic policies that prohibited federal intervention in corporate development.
- BThe implementation of the Dawes Severalty Act to break up corporate monopolies and return land to small farmers.
- The granting of public land and financial subsidies to private corporations to construct transcontinental railways.Answer
- DThe adoption of federal regulatory measures during the Progressive Era to nationalize the country's transport systems.
Answer
The granting of public land and financial subsidies to private corporations to construct transcontinental railways.
The correct answer is correct because the federal government actively promoted transcontinental railroad construction during the mid-to-late nineteenth century by granting public lands and issuing low-interest government bonds to private railway corporations. Agrarian reformers, such as the Grange, argued that since these private companies were subsidized with public resources, the government had the authority and duty to regulate their rates and prevent corporate exploitation of farmers.
Step-by-Step Solution
Key Concept
Federal government subsidies and land grants for transcontinental railroad construction, and the resulting agrarian protests against corporate monopoly power.