The Economic Development of the West


The Federal Government subsidized the settlement and economic developement of the west in a number of ways, primarily by giving land both to business and individuals.

The Federal Government subsidized the settlement and economic development of the Northwest in a number of ways; first by the chartering of railroads and the granting to the railroads of land grants intended to be used by the railroads for the financing of the intercontinental lines. “Sixty-one separate railroads received federal land grants totaling 131,350,534 acres before Congress terminated the program in 1871.” (Schwantes, 173) The cost of building the railroad tracks varied of course with the terrain but averaged between $20,000 and $30,000 a mile. (Fahey, 23) With each mile the railroad received 20 sections of land (A forty mile wide strip would contain 20 odd sections per mile.), and sell the land for an average of $2.60 an acre cash and more on credit. A cash sale would net the railroad $33,280, or enough to finance the construction. (Fahey, 25) The railroad company would then own the tracks at no cost to itself or its shareholders or creditors. Since the railroads would be crucial to the financial development of Northwest communities, the land grant program was a form of economic subsidize to a large corporation which was intended to “trickle down” to the farmers and merchants.

Federal Homestead Act of 1862

Congress passed and the President signed several laws within the forty years from 1862 to 1902 designed to encourage settlement of the west. The first was the Homestead Act of 1862 which offered 160 acre parcels to settlers who would live on the land and farm it for a period of time. The act offered no credit to farmers however, and provided no means for them to obtain the credit necessary to purchase what they needed to start a farm. (Schwantes, 296) The size of the homestead was appropriate for some parts of the country or too little in others, such as the semiarid regions. “For many, 160 acres were too few for a paying wheat farm; they got additional land by filing under a different law or by deceit.” (Fahey, 6) In 1885, “Land Commissioner William Sparks…alleged that three-quarters of the final preemption entries in Washington had been frauds.” (Fahey, 6-7)

Desert Land Grant Act of 1877

The Desert Land Grant Act of 1877 granted 640 acres to a settler willing to farm and irrigate the land for a three year period, but also did not provide the means for a farmer to obtain the irrigation equipment or build the system needed for delivery of the water. The Timber and Stone Act of 1878 resulted in timber men receiving large tracts of land instead of individual farmers as intended. (Schwantes, 296-7)

Carey Act of 1894, Washington and Idaho Impact

It was not until the passage of the n 1894 that Congress passed a law that had a substantial effect on turning semiarid land into irrigated land. This act offered “agrarians what amounted to a generous welfare program.” (Schwantes, 297) The law encouraged state and private cooperation by offering each state a million acreCarey Act is if the state found a way to irrigate and “reclaim” the land. There were twenty-three Carey Act projects in Idaho including the Twin Falls project, “the largest private irrigation project in America…” Although Idaho found a way to make good use of this law there were no Carey projects in Washington.

Newlands Act of 1902

In 1902, Congress created the United States Reclamation Service under the Newlands Actto supervise the construction and maintenance of a number of canals and dams to support reclamation efforts. This law also made it easier for a farmer to obtain irrigated lands but as a practical matter the act often favored large operators who could afford the equipment and machinery necessary to engage in a large scale farming operation. “The Newlands Act, although designed to help small farmers often resulted in making millionaires of some farmers “who managed to amass large land holdings.” (Schwantes, 301) TheNewlands Act also made possible the constructions of canals and dams including “the 349 foot-high Arrowrock Dam in 1915.—the world’s tallest until 1932…” The Arrowrock Dam “gave the Boise Valley a surplus of water for the first time and permitted the creation of 1,167 new irrigated farms comprising 67,454 acres. (Schwantes, 298)

Dawes Act of 1887

There were other acts of Congress that could be labeled attempts to subsidize the economy, although other motivations were usually present. The Dawes Act of 1887 empowered the President to grant title of 160 acres to the head of each Indian family with smaller allotments to single members of the tribe, within those tribes that were ready to assimilate completely into white society and farm the land. With the grant of the land, which could not be alienated by the Indians for 25 years, they were granted U. S. citizenship. The proposal was resisted until it was discovered by land hunger speculators that the allotment would open up the rest of the reservation, previously granted to the tribe under treaty, to settlement by non Indian farmers.

Public Education in Pacific Northwest

The federal Government also subsidized the economic development of the Northwest though the support of public higher education within the Northwest. “The first college or university funded by public money was the University of Washington, which opened in Seattle in 1861.” (Schwantes, 276) Two townships or 46,080 acres were granted to each Oregon and Washington by Congress in an attempt to promote public higher education. The University of Oregon opened in Eugene in 1876 after overcoming resistance from supporters of Willamette University. The more significant boast to public education came with the establishment of the land grant universities of Washington State University, Oregon State University and the University of Idaho which was established in Moscow instead of Boise in order to give panhandle residents some feeling of inclusion within the state of Idaho (Schwantes, 277)


  1. Carlos A. Schwantes, The Pacific Northwest; An Interpretive History, (Revised Edition, 1996)
  2. John Fahey, The Inland Empire, Unfolding Years, 1879-1929 (Seattle: University of Washington Press)