U. S. Civil War Debt 6

Denver and Rio Grande Railroad in Colorado, 1898.

During the American Civil War Europe was busy building a railway through Europe and U. S. investment interests were involved. By the end of the Civil War the Dutch banking firm of Wertheim & Gompertz was induced to invest in New Mexico’s Maxwell Land Grant. The American civil engineer, William Jackson Palmer had conducted a survey relative to several routes proposed for the transcontinental railroad. Palmer, a former Union General, was chosen to supervise the Kansas Pacific railroad route through the west and he favored the route which crossed the Maxwell Grant.

When Lucien Maxwell solidified his claims to the former Beaubien-Miranda grant and opened several successful mines, Wertheim & Gompertz, a large Dutch bank, agreed to finance the sale and further development of the grant under English ownership. Shortly thereafter, the transcontinental railroad route changed and the mines’ successes became complicated. The problems included Homestead Act settlers’ claims, confirmation of the grant’s survey, and lack of adequate water for current mining operations. The European bank began to look for a better prospect.

 At the same time the Maxwell Grant was sold (1870) to an English syndicate brokered by Colorado banker, Jerome Chaffee, the Denver Pacific Railroad was contracted to William Palmer to complete the Kansas Pacific (as the Denver Pacific) and join the Union Pacific and the Central Pacific Railroads.

General Palmer, in order to fulfill the promise of a railroad to the southwest, secretly proposed the construction of a route from Denver through the Arkansas Valley and New Mexico, eventually to El Paso and southern California. Investors had to be found and he was contracted to complete the Kansas Pacific. Others were dedicated to making the southwestern route a reality: one of them ex-Colorado Governor John Evans. Evans set about making land purchases along a proposed route for the Denver & Rio Grande Railroad.