Eight months after the United States enters World War I on behalf of the Allies, President Woodrow Wilson announces the nationalization of a large majority of the country’s railroads under the Federal Possession and Control Act.
By: History.com Editors
1917
U.S. government takes over control of nation’s railroads
Published: November 05, 2009
Last Updated: January 25, 2025
Evolution of Railroads
In 1869 the Union Pacific and Central Pacific railroads converged at Promontory Summit, Utah, completing the Transcontinental Railroad.
The U.S. entry into the war in April 1917 coincided with a downturn in the fortunes of the nation’s railroads: rising taxes and operations costs, combined with prices that were fixed by law, had pushed many railroad companies into receivership as early as late 1915. A year later, in a last-minute bill passed through Congress, Wilson had forced the railroad management to accept union demands for an eight-hour work day. Still, many skilled workers were leaving the cash-poor railroads to work in the booming armaments industry or to enlist in the war effort.
By the end of 1917, it seemed that the existing railroad system was not up to the task of supporting the war effort and Wilson decided on nationalization. Two days after his announcement, the United States Railroad Administration (USRA) seized control. William McAdoo, Wilson’s secretary of the treasury, was appointed Director General of Railroads. The railroads were subsequently divided into three divisions—East, West and South. Passenger services were streamlined, eliminating a significant amount of inessential travel. More than 100,000 new railroad cars and 1,930 steam engines were ordered–designed to the latest standards–at a total cost of $380 million.
In March 1918, the Railroad Control Act was passed into law. It stated that within 21 months of a peace treaty, the railroads would be returned by the government to their owners and that the latter would be compensated for the usage of their property. Consequently, the USRA was disbanded two years later, in March 1920, and the railroads became private property once again.
Timeline
Also on This Day in History
Discover more of the major events, famous births, notable deaths and everything else history-making that happened on December 26th
Related Articles
World War I
Why World War I Ended With an Armistice Instead of a Surrender
Both sides had suffered too much to continue, but Germany would be left battered by harsh terms.
World War I
How German U-Boats Were Used in WWI—And Perfected in WWII
After terrorizing trans-Atlantic ships in World War I, German U-boats grew even more fearsome in World War II.
World War I
5 Advances That Followed Pandemics
Diseases have devastated human populations, but they've also inspired social upheaval and innovations.
World War I
America’s Patriotic Victory Gardens
During both World Wars, America's agricultural production became a powerful military tool.
About the author
HISTORY.com works with a wide range of writers and editors to create accurate and informative content. All articles are regularly reviewed and updated by the HISTORY.com team. Articles with the “HISTORY.com Editors” byline have been written or edited by the HISTORY.com editors, including Amanda Onion, Missy Sullivan, Matt Mullen and Christian Zapata.
Fact Check
We strive for accuracy and fairness. But if you see something that doesn't look right, click here to contact us! HISTORY reviews and updates its content regularly to ensure it is complete and accurate.
Citation Information
- Article title
- U.S. government takes over control of nation’s railroads
- Author
- History.com Editors
- Website Name
- History
- Date Accessed
- March 25, 2025
- Publisher
- A&E Television Networks
- Last Updated
- January 25, 2025
- Original Published Date
- November 05, 2009
History Every Day
Sign Up for "This Day in History"
Uncover fascinating moments from the past every day! Learn something new with key events in history, from the American Revolution to pop culture, crime and more.
By submitting your information, you agree to receive emails from HISTORY and A+E Global Media. You can opt out at any time. You must be 16 years or older and a resident of the United States.
More details: Privacy Policy | Terms of Use | Contact Us
