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The week's question
In March 2025, in the thread "Re: OT, out", Umm asked the members: "Do you think it is because America is made up of magical soil that makes businesses based in America magically profitable?" This week it is put to everyone again. The button below opens the small thread re-asking it - read what others have said so far, then give your own answer as an ordinary reply.
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Personal Finance / Macroeconomic Trends & Risks
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Author: sutton ✭  😊 😞
Number: of 4581 
Subject: The railroad / data center comparison
Date: 09/23/26 10:08 PM
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I had been musing on the AI infrastructure buildout, and how robust the comparison was with the railroad boom of the last half of the 19th century. I’d made some notes in preparation for a more complete essay when the NYT scooped me in an editorial today:

nytimes.com - AI politics railroads history

So I won’t rewrite, especially since the author has paid fact-checkers that have already signed off on his work. It’s a good restatement of the thesis re: massive capital investment, sharp-elbowed oligarchs, societal dependence on the end product, hijacking of local/state/federal governance.

But what I didn’t like was the author’s glossing over the particulars of railroads’ societal transformation, limiting that part of the discussion to handwaving: “vast scale and tremendous ability to produce wealth and power” and so on.

So, here’s my addition -- the discussion he missed (or maybe the editor marked out):

-------------------

Prior to railroads, there were three ways to move goods and people from one place to another: boats; wagons pulled by draft animals; and humans on foot (i.e., a pedlar and his pack, or pushing a wheelbarrow).

Both the wagons and the people on foot were limited to perhaps 15 miles a day. For cargo capacity, the people were limited to maybe thirty pounds. Draft animals and a wagon could up the load to perhaps a ton, but were still limited to a day’s walk. At the end of each day, both the cattle and the people need to be fed, hydrated and rested overnight.

I asked Perplexity to look into typical 1850 costs of shipping one ton of freight via wagon transport over 150 miles. There are too many variables for a reliable number, but a reasonable middle estimate for established trade routes would be perhaps $700 (in 2026 USD) on good, well-traveled routes, and double/triple that for hillier, more difficult destinations. Think of it as a robust pickup truck hauling a full load, but restricted to 3-5 mph, and a 15-mile daily range with an overnight stop to fuel, water, and rest each day.

Boats, however, were entirely different. Coastal and river routes carried multi-ton vessels prior to the Roman era (one Bronze-age wreck had an estimated eleven-ton cargo capacity). By the time of settling the New World in the 17th century, blue-water ships carried 750 tons; by the advent of the East Indiamen (ca. 1800), large oceangoing ships could carry well over a thousand tons.

But in the pre-railroad era once you got to shore, your land transport wasn’t much different than the Romans’: fifteen miles a day, one ton, and an overnight rest. And, a cost of transport that in a hundred miles or more would generally outstrip the value of household goods.

I asked Perplexity to draw a map for me of North America, highlighting areas that were within fifteen miles of either a port or of a navigable river. Here it is:

d2z0o16i8xm8ak.cloudfront.net - North america

...and here’s Western Europe:

d2z0o16i8xm8ak.cloudfront.net - Western europe

So, only within the highlighted areas were the practical limits of robust long-distance commerce for literally thousands of years until the railroads.

By 1850, however, anywhere where a railroad had been built a typical train of wooden carriages carried around a hundred tons of freight – about what the Romans routinely used to move goods and people around both the Italian peninsula as well as the rest of the Mediterranean and Aegean seas.

Fifty years later, freight trains routinely carried over seven hundred tons – the same as the cargo capacity of the ships that settled the New World.

Heavy commerce was no longer restricted to the stripes on the map anywhere that was suitable for a rail line.

That was the massive and fundamental restructuring we hear about. And which we may be on the cusp of again.

--sutton
who remembers reading in a Berkshire annual letter maybe ten years ago that contemporary US railroads charge about a nickel per ton-mile for bulk freight
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